Hyundai Is Asia's Stock Star This Year After Nvidia Announcement

Hedge Fund Elliott Combats Hyundai, and South Korea's Corporate Culture

The dramatic swings seen in Asian equity markets at the onset of the Iran war are easing off. Tuesday is a generally positive day for Asian stocks, but the most notable feature of Tuesday’s trading is the reduced volatility.

Not that Asia-focused investors are jumping back in with both feet. More like they’re dipping a toe back in the water, while seeking a firm footing in shifting sand.

Hyundai Motor has been one of the star performers this year, up 74.9% as the company deepens ties with Nvidia.
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“Oil prices remain high, and risk-off flows are still in place, but market volatility is down,” Nomura Securities chief strategist Naka Matsuzawa pointed out in a note to clients. “Investors are shifting from shedding positions in reaction to geopolitical shock in the Middle East to building positions pricing in economic instability.”

Chip Markets Move on Nvidia News

The chip-driven markets in South Korea and Taiwan are the biggest gainers on Tuesday. The Kospi in Seoul ends today up 1.6%, with the Taiex in Taipei up 1.5%.

Those relatively shallow markets are driven by their largest components. Samsung Electronics (KR:005930 is up 2.8% on Tuesday, after the company said it would treble its production of high-performance bandwidth (HBM) chips this year, from 2025 levels, to meet the demand stemming from the rise in artificial intelligence.

The head of memory development at Samsung, Hwang Sang-joon, said at the Nvidia GTC 2026 event that the company intends its top-flight HBM4 chips to make up more than half its HBM production. It also unveiled a sample of its HBM4E chip that improves on the current HMB4 generation.

Tuesday's gain for Samsung was somewhat offset by a 0.4% dip in rival chipmaker SK Hynix (KR:000660), cast in the shade of the Nvidia (NVDA) conference announcements. The two semiconductor stocks make up a combined 38.3% of the Kospi’s total market capitalization.

Hyundai the Year’s Star So Far

The Korean market was also supported on Tuesday by a 3.2% gain in Hyundai Motor HYMLF (KR:005380), one of the star performers in 2026, up 74.9% year to date.

The carmaker and its affiliate Kia KIMTF (KR:000270) are expanding their partnership with Nvidia, the partners announced at the Nvidia conference. They will be using Nvidia computing power to support autonomous driving technology, including driver assistance for some production vehicles as well as robotaxis under Hyundai’s Motional program.

Kia shares rose 3.3% on Tuesday and are up 38.7% in 2026.

Hyundai and Kia will install Nvidia's Drive system in vehicles, which will then send data to Nvidia's AI computing platform. This should form a "continuous development cycle" with real-world driving data improving AI model training and refinement, the partners say, and the AI informing the engineering of the carmakers.

TSMC to Book Foundry Business

In Taipei, Taiwan Semiconductor Manufacturing Co. (TSM) (TW:2330) is up 1.4%, representing 43.4% of the total market cap in its home market. The chip foundry market-share leader is only building its position of power in the physical production of chips, increasing its share of world foundry production to 69.9% for 2025, up from 64.4% in 2024.

TSMC is agnostic about who designs the chips that it makes. But it got a boost from Nvidia CEO Jensen Huang’s forecast that AI chip sales will rise to $1 trillion by 2027.

Oil prices continue to bubble away in the background, causing concern. Crude oil prices are back below $100 per barrel as I write, but any rise back above that psychological barrier sends Asian markets into a downward spin.

As I noted in my last column, South Korea, Taiwan, Japan and the Philippines import essentially 100% of their oil, and much of that comes through the Strait of Hormuz, now a bottleneck. The figure is well above 50% for almost all Asian nations.

Bank of Japan Warns Ahead of Rates Meeting

So we are watching for inflation to creep higher. Ahead of the rate-setting meeting in Japan that starts on Thursday, Bank of Japan Governor Kazuo Ueda on Tuesday warned that inflation in Japan is accelerating back toward the 2.0% target. It had dipped to 1.5% in January, the first time it had fallen below 2.0% in almost four years, since March 2022.

Japan on Monday began its largest release on record of its oil reserves, pumping an added 80 million barrels into the system. That’s some 17.7% of its total reserves. Prime Minister Sanae Takaichi also announced the reinstatement of subsidies to cap gasoline prices at around ¥170 ($1.07) per liter.

While Japan’s central bank would like to raise rates, it is moving very slowly, taking rates to just 0.75% with its raise in December.

Australia Hikes Rates

Australia did raise rates on Tuesday, the second straight monthly increase, moving rates to 4.1%. The Reserve Bank of Australia says higher borrowing costs are necessary to corral inflation.

Investors had been anticipating the move, however, and the S&P/ASX 200 benchmark in Sydney still rose 0.4% on Tuesday.

Stocks in Hong Kong inched ahead 0.1% on Tuesday despite the White House pushing back U.S. President Donald Trump’s intended trip to China from the planned March 31 to April 2 date.

“We’re re-setting the meeting, it looks like it will take place in about five weeks,” Trump said on Tuesday at a White House press conference.

There’s much for Trump and Chinese President Xi Jinping to discuss, with China buying some 90% of Iran’s oil. But pushing back any Xi-Trump summit makes sense until there’s some kind of resolution in sight to the U.S.-Israel attacks on Iran.

While volatility is dampening in the Asia Pacific region, keep a watch on oil and inflation. A rapid increase in either could destabilize markets that, for now, appear to have found a footing after three weeks of conflict in the Middle East.

At the time of publication, McMillan was long TSMC and NVDA.