TradingKey - On August 18, Japanese and South Korean stock markets diverged in early trading. The South Korean Composite Stock Price Index (KOSPI) opened higher and expanded its gain to 2.2%, standing at 7,131.40 points; Japan's Nikkei 225 Index (JPN225) came under pressure and fell, down 0.81% to 68,658.17 points.

Source: TradingView

South Korea's semiconductor sector continued to lead gains, with Samsung Electronics rising 3.46% to 284,000 won (about $201), and SK Hynix surging 6.38% to 1,750,000 won, serving as the main driving force behind KOSPI's strength.

Japanese tech stocks were also active, with Kioxia gaining 1.76% to 62,930 yen (about $395) and SoftBank Group rising 3.89% to 6,115 yen, as AI- and memory-related stocks extended their strength.

Overnight, the three major U.S. stock indices closed lower across the board. The S&P 500 Index fell 0.52% to 7,745.06 points; the Dow Jones Industrial Average dropped 0.51% to 53,459.78 points; and the Nasdaq Composite Index slipped 0.32% to 26,644.91 points.

However, the semiconductor sector rebounded against the trend, with the Philadelphia Semiconductor Index rising about 1.6%, and memory chip stocks performing particularly well, with SanDisk (SNDK) surging nearly 9% and Western Digital (WDC) rising over 5%, providing positive guidance for Asian semiconductor stocks.

Meanwhile, uncertainty over the situation in the Middle East continues to weigh on global market sentiment. U.S. President Donald Trump stated that the U.S. does not seek to extend the memorandum of understanding reached with Iran. The previously set 60-day negotiation period between the two sides expired on August 17, but a final agreement has yet to be reached. Iran warned that if diplomatic efforts fail to make progress, it could further escalate tensions in the Strait of Hormuz and the broader Middle East region.

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