Tokyo at record levels, Beijing on hold, why Asia's markets are drifting apart in 2026

Japan's benchmark index stands higher than ever. Malaysia reports growth that beats every forecast. And China's stock market barely moves. Three reports from the same week, three different situations.

The short version

• The Nikkei 225 closed at 68,308.59 points on 13 August 2026, up 1.16 percent. The Topix reached 4,176.04 points, its second record close in a row.
• Malaysia grew 6.0 percent year on year in the second quarter, above the advance estimate of 5.8 percent.
• China is standing still because its central bank was again vague about monetary easing.

What happened in Tokyo

On 13 August 2026 the Nikkei 225 closed at 68,308.59 points, up 784.53 points or 1.16 percent and the third winning session in a row. The broader Topix rose 37 points to 4,176.04, its second record close in a row.

The recovery was carried by semiconductor stocks following the overnight strength of their American peers. The Philadelphia semiconductor index had risen 2.5 percent in the previous session. Advantest and Recruit Holdings hit highs. Toppan Printing gained 10.78 percent, Murata Manufacturing 10.25 percent and Taiyo Yuden 6.53 percent.

The rollercoaster behind it

A single trading day distorts the picture. The Japanese market has seen swings in 2026 that rank among the sharpest in years.

On 11 June the Nikkei closed at 64,179 points, down 1.9 percent, triggered by military tension between Iran and the United States and a correction in American technology stocks. Late July brought a counter move of more than five percent in a single day. On 10 August the index closed at 66,970.22 points, up 2.08 percent, and a few days later at 65,193.16 points, down 0.75 percent, with a daily range from 64,651 to 65,991 points.

SoftBank sits at the centre of these swings. The share fell almost 30 percent from its highs at one point and on other days hit the maximum permitted daily gain. Because the Nikkei weights by share price, a stock like that drives the whole index even when the other 224 members barely react.

The interest rate factor

In Japan one force pulls against the recent strength. Producer prices rose sharply in July, which makes a rate increase by the Bank of Japan more likely. Japan held extremely low rates for decades, which made the yen the preferred funding currency. If Japanese rates rise, that construction gets more expensive, positions are unwound and the yen strengthens. A stronger yen in turn shrinks the foreign earnings that exporters book in yen, and exporters make up a large part of the Nikkei.

South Korea and Malaysia

South Korea's Kospi moves along similar lines, with a heavier tilt to memory chips. It closed at 6,299.66 points on 10 August and a few days later fell 1.19 percent to 6,221.60. SK Hynix lost 4.82 percent while Samsung Electronics edged up.

SK Hynix reported record second quarter 2026 revenue of 79.3 trillion won at an operating margin of 76 percent. The share then fell nine percent. A margin of 76 percent invites competitors to add capacity, and added capacity ends every price cycle sooner or later.

On 14 August Malaysia's central bank reported growth of 6.0 percent year on year in the second quarter. The advance estimate had been 5.8 percent and the first quarter 5.4 percent. Against the previous quarter the economy grew 2.5 percent on a seasonally adjusted basis, taking first half growth to 5.7 percent. Services grew 5.9 percent, industrial production accelerated to 7.3 percent and mining rose 9.2 percent. Electrical and electronic goods were the strongest export driver. The central bank kept its annual forecast of four to five percent and expects inflation between 1.5 and 2.5 percent in 2026.

Why China is standing still

The CSI 300 went nowhere and the Hang Seng slipped slightly. China's central bank again spoke vaguely about monetary easing. After recent weak economic data investors had expected firmer signals.

The split between winners and laggards follows no geographic logic. It follows how strongly an economy is tied to the semiconductor and data centre cycle. Japan gains through suppliers and equipment makers, South Korea through memory chips, Malaysia through assembly, testing and electronics exports, Taiwan through manufacturing itself. China depends on a broader mix of domestic demand, property and industry.

Frequently asked questions

Where does the Nikkei stand right now

The Nikkei 225 closed at 68,308.59 points on 13 August 2026, up 784.53 points or 1.16 percent. The broader Topix reached 4,176.04 points, its second record close in a row. Semiconductor stocks drove most of the gain.

Why is the Japanese market so volatile in 2026

The Nikkei weights by share price rather than company size. Highly priced single stocks such as SoftBank, which at one point was almost 30 percent below its highs, move the index by hundreds of points. On top come shifting expectations about the semiconductor cycle and about interest rates.

What would a Bank of Japan rate rise mean for shares

Higher Japanese rates make yen funding more expensive and prompt investors to unwind positions. The yen strengthens as a result. A stronger yen shrinks the foreign earnings exporters book in yen, and exporters carry heavy weight in the Nikkei.

How fast did Malaysia grow in the second quarter of 2026

The Malaysian economy grew 6.0 percent year on year, above the advance estimate of 5.8 percent. Against the previous quarter growth was 2.5 percent on a seasonally adjusted basis. The drivers were private consumption, investment and electrical and electronic exports.

This analysis is for information only and is not investment advice.