From reset to readiness: South-east Asian capital markets in 2026

AFTER two years of volatility, 2025 brought a reset for South-east Asia’s technology and investment markets. Falling interest rates, a weaker dollar, and the reopening of initial public offering (IPO) markets in Hong Kong and India stabilised sentiment across the region.

While conditions have not fully recovered, the year brought clearer signals on where capital is flowing, how risks are being assessed, and which businesses are better positioned for the next phase of growth.

AI investment remains dominant but highly concentrated

Artificial intelligence (AI) dominated global investing in 2025, capturing roughly half of total funding. Investment activity was highly concentrated, with fewer than 10 companies raising nearly 80 per cent of total AI funding, much of it through rounds exceeding US$500 million. This underscores the growing advantage of large-scale players operating across models and applications.