Asian Stocks Diverge on AI Hopes, US Inflation
Tech optimism lifted some Asian markets while US consumer price data fueled bets on a larger Federal Reserve rate hike in December.
Updated on Nov. 11, 2026 in Inflation
Asian stocks diverged on Wednesday as renewed optimism around artificial intelligence was offset by US inflation data. US consumer prices rose 0.4 percent month-on-month in October, above forecasts, after a 0.6 percent rise in September.
Why it matters
Traders have priced in a bigger-than-expected Federal Reserve rate hike at its December meeting after food prices jumped, a shift that could tighten financial conditions worldwide. Chicago Fed President Austan Goolsbee called the report 'another distressing report, borderline disturbing.'
US consumer prices rose 0.4 percent month-on-month in October, above a forecast of 0.3 percent, following a 0.6 percent rise in September. Whether this pace persists, and how the Federal Reserve will respond at its December meeting, remains unresolved.
The players
Federal Reserve
The United States central bank, whose December rate decision is being priced in by markets after October inflation data came in above forecast.
Austan Goolsbee
President of the Federal Reserve Bank of Chicago, who called the latest inflation report 'another distressing report, borderline disturbing.'
Christopher Waller
A Federal Reserve governor who suggested he could support a 50-basis-point rate hike in December.
SoftBank
The Japanese technology investment group, which reported a loss of more than $7 billion in its fiscal second quarter and whose shares tumbled in Tokyo.
Nvidia
The US chipmaker whose shares are central to the AI trade, and which is the subject of an FBI investigation.
The details
Tech stocks bounced on bargain-hunting after last week's rout, which was fueled by fears that Democrats would tighten regulation of AI. Hong Kong's Hang Seng fell while Tokyo's Nikkei and Seoul's Kospi rose, and Brent crude hovered around $92 a barrel after edging up on hopes for a US-Iran deal.
Timeline
July-September: OpenAI earned $10 billion in quarterly revenue for the first time, according to Bloomberg.
Last week: A tech stock rout was fueled by fears of tighter AI regulation.
Tuesday: Wall Street indexes ended lower, snapping a two-day rally.
Wednesday: Asian stocks diverged on AI optimism and inflation data.
December: The Federal Reserve is set to decide on rates at its meeting.
Macro View
The October inflation reading, with consumer prices up 0.4 percent month-on-month, pushes markets toward a larger-than-expected Federal Reserve hike at its December meeting. That places the data within the Fed's ongoing campaign to bring inflation back under control after the recent price pressures.
Higher-than-expected consumer price increases raise the likelihood of a larger Federal Reserve rate hike, which can push up borrowing costs on loans and mortgages. Households facing food-price increases may see their monthly budgets squeezed while rates remain elevated.
The takeaway
Watch the upcoming inflation releases and the Federal Reserve's December decision, since they will shape borrowing costs and market direction. Tracking food-price trends can also help gauge whether inflation pressures are easing or building.
What happens next
The Federal Reserve is scheduled to make its rate decision at its December meeting, when traders are pricing in a possibly larger-than-expected hike.
Further reading
For the broader pressures behind the October price increase, see our coverage of Inflation.
Source note: This article includes information reported by Kuwait Times.
