In the current quarter, the MSCI Asia Pacific value stocks index rose by approximately 6%, while the growth index declined by about 2%. This marks the most significant outperformance of value stocks over growth stocks in the region since the first quarter of 2022.
The information technology sector, which makes up about one-third of the regional index, fell by 5.6% this quarter. In contrast, Asian financial companies saw their shares surge by 12%.
Major semiconductor companies experienced sharp declines. In late July, SK Hynix shares dropped 14.7% and Samsung Electronics shares fell 13.4% during a single trading session.
Asian value stocks are currently trading at 10.8 times one-year forward earnings. This is lower than the multiples for US equities at 17.9 times and European stocks at 12.3 times.
The shift is driven by intensifying competition from Chinese semiconductor firms, particularly in mature-node production, which has pressured the margins and market shares of established Korean and Taiwanese giants.
