Asia stocks rebound as chipmakers recover, Indonesia rout deepens with 11% slump Roushni Nair Fri, October 16, 2026 at 12:14 AM EDT 4 min read ^JKSE -11.24% ^NDX -0.05% ^GSPC +0.33% JKSE KS11 Investing.com -- Asian stocks rebounded on Friday as investors bought beaten-down technology shares following a sharp selloff driven by concerns over debt financing for the artificial intelligence boom and intensifying competition from China.
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South Korea's KOSPI climbed 3.3%, while Japan's Nikkei 225 advanced 1.7%, recovering some of Thursday's steep losses as semiconductor stocks regained ground.
The MSCI Asia Pacific index rose 1.1%. The rebound followed Thursday's nearly 8% plunge in the KOSPI, which took the index to its lowest close since late-July and triggered a circuit breaker amid heavy selling in memory-chip makers.
Indonesia's stocks bucked the regional recovery, with the Jakarta Composite plunging more than 11% in its steepest one-day decline since January 1998, after MSCI proposed reclassifying the country from emerging-market to standalone-market status.
In U.S. futures, Nasdaq 100 futures and S&P 500 futures were little changed, pointing to a more cautious start after Wall Street's cash indexes posted modest gains on Thursday.
South Korean memory-chip makers led the recovery, with Samsung Electronics rising 2.9% and SK Hynix gaining 2.22%. Japan's Kioxia advanced 3.3%, while Sony rose 2.9%. Taiwan's Largan fell 5.7% and Foxconn rose 1.3%.
The rebound followed a technology selloff intensified by concerns about the financial risks underpinning the AI investment boom, particularly the debt burden of cloud-computing company CoreWeave.
Its shares recovered some ground on Thursday after extending Wednesday's 15.5% slump early in the session, when reports that its bond yields had reached distressed-debt levels helped fuel a broader global selloff in AI-linked stocks.
The selloff also reflected worries over Chinese competition after ChangXin Memory Technologies (CXMT) reported progress on a next-generation DRAM architecture that could intensify competition with established manufacturers such as SK Hynix and Samsung. CXMT shares rebounded nearly 5% on Friday.
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Hong Kong's Hang Seng gained 1.2%, China's CSI 300 rose 0.9% and the Shanghai Composite added 1.1%. Taiwan's benchmark index advanced 0.7%, although shares of Taiwan Semiconductor Manufacturing Co. (TW:2330) edged down 0.4% despite the chipmaker reporting record quarterly profits and issuing an upbeat revenue outlook.
Indonesia's equity market bucked the regional recovery, with the Jakarta Composite plunging to its steepest one-day fall in nearly three decades after MSCI proposed reclassifying the country from emerging-market to standalone-market status.
MSCI cited persistent concerns over market transparency and functioning, including opaque shareholding structures and suspected coordinated trading, saying reforms had not progressed sufficiently.
It froze additions of Indonesian securities to its indexes in January and will seek feedback until April 2027, with a final decision due by the end of June next year.
Indonesia's stock exchange said it had taken steps to improve transparency, while chief executive Jeffrey Hendrik sought clarification from MSCI. The benchmark index was already the world's worst-performing this year, with its benchmark index down more than 30% and foreign investors recording net equity sales of $4.7 billion.
Elsewhere in Southeast Asia, Singapore's Straits Times rose 0.6%, while Australia's S&P/ASX 200 rose 0.9% and New Zealand's NZX 50 fell 0.6%. In India, the Nifty 50 futures rose 1.5%.
Stronger-than-expected U.S. consumer and producer inflation data, alongside resilient retail sales, raised concerns that price pressures could persist and complicate the Federal Reserve's policy outlook.
While markets initially increased bets on further tightening, they subsequently pared expectations for an October rate hike, with attention turning to December.
Chicago Fed President Austan Goolsbee said some inflationary pressures could prove temporary, but persistent demand, including investment in AI data centres, could warrant a stronger policy response. Fed Chair Kevin Warsh's comments in Bangkok on Friday will be closely watched for clues on the rate outlook.
Meanwhile, escalating Saudi-Houthi tensions and attacks on regional shipping kept oil-supply risks elevated, despite a possible U.S. move to ease sanctions on some tankers to reduce freight costs.
The European Union is also preparing new trade powers targeting China, adding another potential source of uncertainty for Asian exporters and regional equities.
Asia stocks rebound as chipmakers recover, Indonesia rout deepens with 11% slump
Indonesia stocks suffer biggest daily slump since 1998 as MSCI weighs downgrade
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