AI Anxiety Triggers Asian Market Jitters

Asian equities are poised for a mixed opening amidst cautious trading conditions. The region's stock markets are experiencing volatility driven by ongoing concerns surrounding artificial intelligence, particularly its impact on chip development and hardware manufacturing. These anxieties stem from conflicting views on AI's disruptive power versus the timeline for significant investment returns.

Trading volumes are anticipated to be low as several major Asian markets, including China, Hong Kong, and South Korea, remain closed for the Lunar New Year holiday. This limited participation may amplify initial market movements as buyers and sellers assess the evolving AI landscape.

Investors are grappling with the dual prospect of AI drastically reshaping industries, potentially displacing existing companies, and a broader skepticism about the near-term profitability of extensive AI investments. This uncertainty is contributing to a volatile trading environment, even as broader market trends remain upward.

Attention in Asia will also be on the Reserve Bank of New Zealand's upcoming policy decision. While a hold on interest rates is widely expected, the bank's forward guidance and the new Governor's commentary will be closely watched for insights into future monetary policy.

Commodities, including oil, have seen declines, influenced by geopolitical developments such as progress in US-Iran nuclear talks. Gold and silver have also experienced significant drops.