Markets Weigh Widening War, Big Tech Earnings | The Asia Trade 7/23/2026

Summary

This episode dissects big US tech earnings (Alphabet, Tesla, IBM) and their ripple effects across Asian markets, focusing on the AI semiconductor trade. Geopolitical risks from the Iran-US conflict and Houthi Red Sea attacks drive oil prices higher, lifting bond yields and complicating the central bank outlook. Portfolio managers weigh positioning in China, Japan, India, Korea, and Taiwan amid shifting AI capex trends and competitive dynamics.

• Alphabet's cloud revenue soared 82% but higher capex guidance weighed on shares, seen as positive for semiconductor suppliers.
• Tesla missed profit expectations and Elon Musk cautioned that robotics and robotaxi goals need more time.
• IBM cut guidance on weak Mainframe sales, highlighting pressure on software names.
• Houthi attacks on Saudi tankers in the Red Sea pushed oil prices up and reignited inflation fears, pressuring long-dated Treasuries.
• The Bank of Japan is reported open to faster rate hikes, but markets remain skeptical about yen appreciation without a 'shock and awe' move.
• M&G Investments shifts within Asia, overweighting China tech and semiconductor equipment, trimming memory exposure, and reducing Korea/Taiwan weight.
• Japan's corporate governance reforms and India's broad market appeal remain long-term constructive themes.
• Michael Dunne stays positive on Tesla despite near-term profit miss, while cautious on BYD due to China's EV price war.