Key facts
- Asian stocks concluded a strong quarter with mixed performance.
- The U.S. dollar surged, weakening the Japanese yen to a four-decade low.
- South Korea's KOSPI saw significant gains.
- Hong Kong's Hang Seng lagged.
- China's factory activity expanded in June, with the official PMI rising to 50.3.
- Demand for AI products and increased U.S. export orders fueled China's manufacturing growth.
- A royalty financing firm opened a new base in Hong Kong.
- Biotechnology deals in mainland China have seen a significant increase.
- A proposal suggests Shanghai should enhance its role as a financial center.
- Hong Kong's current financial capacity is argued to be insufficient.
- Global financial markets in the first half of 2026 were influenced by Iran tensions and an AI boom.
Asian stock markets concluded a robust quarter with varied performance, significantly impacted by a strengthening U.S. dollar that drove the Japanese yen to a four-decade low. South Korea's KOSPI index registered substantial gains, contrasting with the underperformance of Hong Kong's Hang Seng. The region's markets largely followed Wall Street's upward trend, with South Korea's Kospi showing a rebound. Technology stocks, particularly those in South Korea and Japan, continued to benefit from robust demand for artificial intelligence products.
China's manufacturing sector demonstrated expansion in June, with the official Purchasing Managers' Index (PMI) rising to 50.3. This growth was propelled by strong demand for AI-related products and a notable increase in export orders to the United States, occurring ahead of potential tariff implementations. This expansion offers a degree of economic resilience amidst wider economic weaknesses. In parallel, a significant player in the royalty financing sector has established a new base in Hong Kong. This strategic move aligns with a marked increase in biotechnology deals within mainland China, indicating heightened investment interest in the region's life sciences industry.
However, a proposal has emerged suggesting that Shanghai should enhance its standing as a global financial center, positing that Hong Kong's current capabilities are insufficient to meet growing financial demands. The proposal advocates for accelerated development in Shanghai to address these needs. Global financial markets in the first half of 2026 were notably shaped by geopolitical tensions in Iran and a significant boom in artificial intelligence, factors that influenced investor sentiment and market performance across Asia. Oil prices showed stabilization following reports of delegations heading to Qatar, although Iran indicated no direct talks with the U.S. were arranged.