Nikkei rebounds as Kospi slips, AI capex jitters split Asian markets

Asian equity markets exhibited sharp divergence on Monday as investors reassessed the durability of artificial intelligence capital expenditure. Japan's Nikkei index rebounded approximately 1% to reach 64,082.36 by the midday break, lifted primarily by a more than 9% surge in SoftBank Group shares following previous steep declines. In contrast, the broader Topix index remained subdued near 4,057 as buying shifted away from defensive value stocks. Meanwhile, South Korea's Kospi dropped around 1%, weighed down by heavyweights Samsung Electronics and SK Hynix tracking overnight declines in major US chipmakers including Nvidia, Intel, and Micron. Markets also contended with broader macro headwinds, as Brent crude traded above $105 per barrel amid escalating Middle East tensions, stoking inflation fears. Market participants face an eventful week with major monetary policy decisions scheduled from the Federal Reserve, Bank of Japan, and Bank of England. Analysts anticipate continued index-level divergence until clearer signals emerge regarding AI enterprise spending.