Asian shares showed mostly positive movements on Friday, fueled by optimism surrounding technology companies and the global economic outlook. Japan’s Nikkei 225 index climbed 0.5%, reaching 38,566.40, supported by positive data on the country’s industrial production.
According to the Ministry of Economy, Trade, and Industry, Japan’s industrial production increased by 2.8% in July compared to the previous month, rebounding from a 4.2% drop in June. Additionally, Tokyo consumer prices rose more than expected to 2.6% year on year in August, driven by surges in food and utilities prices, potentially impacting the Bank of Japan’s decision on raising interest rates later this year or early next year.
In other markets, Australia’s S&P/ASX 200 rose 0.3%, South Korea’s Kospi increased by 0.6%, Hong Kong’s Hang Seng surged 1.8%, and the Shanghai Composite jumped 1/3%. Conversely, on Wall Street, a late-afternoon decline in some Big Tech companies led to a mixed finish for U.S. stock indexes.
Despite the U.S. stock market’s mixed performance, positive economic indicators are contributing to investor optimism, with the Commerce Department revising U.S. economic growth for the second quarter to 3%. This, along with strong earnings reports, is highlighting the resilience of the economy amid challenges like inflation and interest rates.
Traders are eagerly anticipating the U.S. government’s release of July inflation data, particularly the Personal Consumption and Expenditures report. Economists are expecting a slight increase in inflation to 2.6% in July from 2.5% in June. Hopes are also rising for the Federal Reserve to initiate interest rate cuts, with expectations of a 1% cut by the end of the year.
Bond yields in the Treasury market saw an increase, with the 10-year Treasury yield rising to 3.86%. In energy trading, benchmark U.S. crude oil prices gained 18 cents to $76.09 a barrel, while Brent crude, the international standard, rose to $80.17 a barrel. The U.S. dollar weakened slightly against the Japanese yen and the euro in currency trading.
Overall, despite some fluctuations in the markets, positive economic data and expectations for policy adjustments are contributing to a sense of cautious optimism among investors.
