San Francisco Frontiers - Stocks diverge as rate hopes rise, AI fears ease

In the final business days before Christmas, tech firms led a rally in Asia, with South Korea's Samsung Electronics, Taiwan's TSMC and Japan's Renesas among the best performers.

Hong Kong, Shanghai, Sydney, Seoul, Singapore, Mumbai, Bangkok, Wellington, Taipei and Manila stock markets all saw healthy advances.

Tokyo was the standout, piling on 1.8 percent thanks to a weaker yen.

However, London, Paris and Frankfurt fell.

"Tech stocks are leading this 'Santa Rally' and Europe is tech-light, so it may be a laggard as we start a new week," said Kathleen Brooks, research director at trading group XTB.

Gold, which benefits from lower US interest rates, hit a fresh record of $4,420.30, while silver also struck a new peak.

The precious metals, which are go-to assets in times of crisis, also benefited from geopolitical worries as Washington steps up its oil blockade against Venezuela and after Ukraine hit a tanker from Russia's shadow fleet in the Mediterranean.

Oil prices rose more than one percent amid the geopolitical tensions.

Equity gains tracked a surge on Wall Street Friday led by the Nasdaq as technology giants rallied following a bumper earnings report from chip giant Micron Technology that reinvigorated the AI trade.

That came on top of news that Oracle will take a 15 percent stake in a TikTok joint venture that will allow the social media company to maintain operations in the United States.

The tech bounce came after a bout of selling fuelled by concerns that valuations had been stretched and questions were being asked about the vast sums invested in artificial intelligence that some warn could take time to see returns.

Forex traders are keeping tabs on Tokyo after Japan's top currency official said he was concerned about the yen's recent weakness, which came after the central bank hiked interest rates to a 30-year high on Friday.

The comments stoked speculation that officials could intervene in currency markets to support the yen, which fell more than one percent against the dollar Friday after bank boss Kazuo Ueda chose not to signal more increases early in the new year.

- Key figures at around 1045 GMT -

London - FTSE 100: DOWN 0.4 percent at 9,858.28 points

Paris - CAC 40: DOWN 0.4 percent at 8,115.74

Frankfurt - DAX: DOWN 0.1 percent at 24,267.32

Tokyo - Nikkei 225: UP 1.8 percent at 50,402.39 (close)

Hong Kong - Hang Seng Index: UP 0.4 percent at 25,801.77 (close)

Shanghai - Composite: UP 0.7 percent at 3,917.36 (close)

New York - Dow: UP 0.4 percent at 48,134.89 (close)

Dollar/yen: DOWN at 157.40 yen from 157.59 yen on Friday

Euro/dollar: UP at $1.1736 from $1.1719

Pound/dollar: UP at $1.3438 from $1.3386

Euro/pound: DOWN at 87.34 pence from 87.55 pence

West Texas Intermediate: UP 1.7 percent at $57.45 per barrel

Brent North Sea Crude: UP 1.6 percent at $61.44 per barrel

A.Smith--SFF