August 4 (Reuters) - Emerging market stocks were mixed on Tuesday as easing volatility surrounding AI-linked trade offered some respite, while currencies were range bound against the dollar as traders monitored developments in the Middle East.
MSCI's index tracking global EM equities .MSCIEF edged 0.2% lower, while its currencies equivalent .MIEM00000CUS was little changed.
The fragile sentiment that has gripped chipmakers, triggering sharp swings in Asian equities, showed signs of stabilising on Tuesday.
South Korea's KOSPI .KS11 rose 1.6%, with investors keeping faith in the growth momentum of chipmakers and attributing the recent selloff largely to the leverage trade rather than concerns around AI spending.
Taiwan's tech-heavy benchmark .TWII was subdued.
Still, some investors remain wary that concerns over excessive investment in AI infrastructure could continue to weigh on sentiment through the second half of the year and beyond.
"We have seen several flavours of this risk bubble up recently, including Chinese competition in large language models (LLMs) and inference, as well as circular financing with Nvidia's deal to back $250 billion of a data centre buildout among others," said Jeff Buchbinder, chief equity strategist at LPL Financial.
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