HK stocks gallop up as midterms fuel caution in region
Nov 5, 2026
Oil, chip stocks and the US dollar were under pressure in Asia on Thursday and just about everything else was up after US voters swept the Democrats to a series of stunning midterm election wins, a result that raised hopes for an end to the country's war on Iran.
In Hong Kong, the benchmark Hang Seng Index opened up 397 points, or 1.66 percent, at 24,316 and almost doubled its gains to be 784 points up in early trading.
The tech index rose 56 points, or 1.43 percent, to open at 3,992 while the China enterprises index too was higher by a similar margin, putting on 116 points, or 1.45 percent, to 8,174.
Up north, the Shanghai Composite Index opened down 39 points, or 1.1 percent, at 3,646.
That downward trend held too for the Shenzhen Component Index, putting it 118 points, or 1.1 percent, lower at 11,216 while the ChiNext Index was 51 points, or two percent, down at 2,493.
In Tokyo, the Nikkei opened 196 points, or 0.32 percent, higher at 62,384, buoyed by declines in crude oil but with gains held in check by fears that the US midterms trashing for President Donald Trump will result in Democrats slowing the pace of AI data centre expansion.
The 225 benchmark was 104 points down at one stage before noon.
In Seoul, the Kospi opened 103 points, or 1.82 percent, lower at 5,580 on fears for AI and chip shares and was 182 points down at one stage before lunch.
Brent crude futures dived nearly 9 percent overnight, falling below US$100 a barrel.
Brent has dropped by about 20 percent so far this week.
If sustained through to Friday's close, it would make for the largest weekly drop in oil prices since a week in April 2020 when US crude briefly fell into negative territory.
Tumbling energy prices encouraged a rally in bonds, which lowered yields, pulled the dollar to a one-month low of US$1.1273 per euro, and helped stocks.
Solar supply chain stocks jumped the most, in anticipation of Democrats boosting support for renewables, while shares in data centre companies and their equipment suppliers across Asia fell on expectations of tougher regulation.
Democratic data-centre opponents who campaigned, in part, on moratoriums on the AI linchpin won stunning victories in Texas and Georgia in a sign public opinion is shifting on the booming sector.
To be sure, most analysts think it ultimately won't dent demand for artificial intelligence, data centres or computer chips but do now expect at least a temporary slowdown.
"The magnitude of the victory is what has caught markets off guard," said Chris Weston, head of research at brokerage Pepperstone in Melbourne.
At US$93.50, oil was testing overnight lows in the Asia morning as traders chose to bet that Trump, facing a Democratic Congress and hurt by high energy prices caused by the Mideast conflict, would be less likely to escalate the war with Iran.
Trump acknowledged on Wednesday that the war played a role in Republicans' defeat and his vice president, JD Vance, was even more blunt on X: "The reason we lost is the war."
A resolution could push oil prices lower still, alleviating inflation pressure and reducing the likelihood of future interest rate hikes. (Reuters/Xinhua)
Edited by Tony Sabine
