HONG KONG - Asian markets were mixed on Friday after Taiwanese chipmaking titan TSMC posted a big profit jump, bolstering confidence in the artificial intelligence sector as the United States struck a trade deal with the self-ruled island.
It came after Wall Street rebounded following two down days, while oil steadied as President Donald Trump stepped back from military action in Iran.
Taipei stocks surged two percent after the government agreed with Washington to boost Taiwanese chipmaking investments in the United States, which will cut tariffs.
Taiwan will remain the world's "most important" producer of the advanced chips that power AI tools, the island's Economic Affairs Minister Kung Ming-hsin said.
Some market-watchers fear the bubble of excitement around AI, which has pushed global markets to record highs, could burst and cause a stock rout.
But TSMC, the world's biggest contract maker of chips, announced Thursday a forecast-busting net profit for the fourth quarter -- seen as a sign of sustained global demand for AI technology.
The company's shares jumped 4.4 percent on Wall Street, and rose three percent Friday in Taipei.
The news spurred US markets, with the tech-rich Nasdaq piling on more than one percent early in the session behind large gains among leading chip firms.
In Asia, traders were watching Tokyo ahead of a week that brings a Bank of Japan policy decision and Prime Minister Sanae Takaichi's expected snap election announcement.
The yen has softened against the dollar on reports that the Bank of Japan will keep its monetary policy unchanged, said Kyle Rodda, senior market analyst at Capital.com.
That "adds to downside pressures on the currency, with a looming election, called to gain a mandate for very expansionary fiscal policy, also a critical headwind", Rodda said.
Tokyo, Shanghai and Hong Kong all closed 0.3 percent down.
Sydney, Wellington, Mumbai, Jakarta, Bangkok and Singapore were all up, and tech highflier Seoul gained 0.9 percent. Manila and Kuala Lumpur posted losses.
London, Paris and Frankfurt opened in the red.
Oil prices continued to steady as Washington distanced itself from military intervention in Iran.