SEOUL, December 02 (AJP) - Asian equity markets were mixed on Tuesday as investors weighed the growing risk of a yen carry trade unwind sparked by rising expectations of a Bank of Japan interest rate hike. Korea’s KOSPI stood out as the region’s strongest performer, drawing sizable foreign inflows even as most other Asian benchmarks stalled or slipped.
The Korean won strengthened slightly to 1,468.9 per dollar, up 2 won from the previous session, supported by foreign capital moving into Seoul’s markets and a renewed push by financial authorities urging exporters and institutions to convert dollar earnings into won. Still, analysts noted that Korea’s M2 money supply growth remains higher than in other major economies, suggesting that currency stabilization will require more time and potentially further policy measures.
The KOSPI jumped 1.9 percent to 3,994.93, briefly approaching the psychologically significant 4,000 line as investors repositioned amid heightened volatility in Japan. Monday’s trade data, which showed a surplus, added momentum.
Foreign investors bought 1.21 trillion won ($800 million) in Korean equities, while institutions purchased 393 billion won. Retail investors sold 1.58 trillion won, locking in recent gains.
Large-cap technology stocks led the advance. SK hynix climbed 3.72 percent to 558,000 won, reclaiming the 550,000-won level for the first time in weeks. Samsung Electronics added 2.58 percent to 103,400 won, consolidating its hold above the symbolic “100,000-Electronics” threshold.
Carmakers, which had slumped the previous day, rebounded sharply: Hyundai Motor rose 4.52 percent to 266,000 won and Kia gained 4.19 percent to 117,000 won. Shipping stocks also surged following the latest trade data, with Pan Ocean up 11.17 percent, Korea Line rising 9.04 percent, and Hyundai Glovis climbing 3.93 percent.
Japan’s Nikkei 225 ended largely flat at 49,303.45, giving back early gains as BOJ tightening expectations solidified. Financial stocks climbed on the prospect of higher rates, with Mitsubishi UFJ Financial Group up 2.46 percent. But analysts cautioned that a full-scale unwind of yen-funded carry positions could trigger broader market stress.
Japanese industrial and robotics names were notable gainers. Fanuc rose 6.51 percent, and Yaskawa Electric advanced 4.67 percent, reflecting optimism that the export downturn may be bottoming and capital expenditure could soon pick up. Exporters that had benefited from yen weakness, including Toyota, retreated, with the automaker falling 1.2 percent.
Taiwan’s TAIEX mirrored Korea’s strength, closing 0.81 percent higher at 27,564.27, led by TSMC, which gained 1.42 percent. MediaTek, after a sharp rally in recent days, slipped 2.08 percent on valuation concerns.
Mainland Chinese markets remained among the region’s weakest as investors assessed the potential impact of a BOJ rate hike on regional liquidity. The Shanghai Composite fell 0.42 percent to 3,897.71, and the SZSE Component declined 0.68 percent to 13,056.70.
Hong Kong’s Hang Seng Index, which touched 26,264 earlier in the day, pared gains to trade 0.14 percent higher at 26,067 as of 4:40 p.m.
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