Asia’s major stock indexes were on the front foot on Thursday, with investors hopeful there will be positive news on US inflation later in the day.
There was also cautious optimism over China’s stuttering economy ahead of a slew of data due out over the next few days and bets rising on more stimulus from Beijing.
But the real drama was in Japan where the Nikkei share average scaled its highest levels since February 1990, as a weaker yen buoyed exporters and caution over an impending hike by the Bank of Japan continued to fade on the back of weak wage data.
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The Nikkei rose 1.77% on its third straight day of gains this week, closing at its highest in nearly 34 years at 35,049.86. The index was also on its way to the largest weekly gain since late March 2020. The broader Topix rose 1.57% to end at 2482.87.
The yen fell 0.9% on the US dollar overnight in the wake of the data and was hovering around 145.52 during Asian trading hours.
Japanese stocks also got a boost from upbeat performances on Wall Street as megacaps rallied.
China stocks rebounded slightly, while Hong Kong shares jumped after a seven-session losing streak as investors bought the dip amid a cautious mood in China’s recovery.
But overall, investor sentiment remained weak ahead of trade, inflation and credit data in the coming days which will gauge the strength of the recovery.
The blue-chip CSI 300 Index added 0.57% and the Shanghai Composite Index rose 0.31%, or 8.95 points, to 2,886.65. The Shenzhen Composite Index on China’s second exchange rallied 1.62%, or 28.03 points, to 1,760.77.
Shares in artificial intelligence and defence security both rose roughly 1.4%, while anime comic gaming companies climbed 2.4%.
In Hong Kong, tech giants surged 1.8%, with food-delivery giant Meituan up 3.8%. Hong Kong’s Hang Seng Index gained 1.27%, or 204.76 points, to close at 16,302.04, and the Hang Seng China Enterprises Index jumped 1.35%.
Shares of digital assets and crypto exchange operator BC Technology Group Ltd jumped 11.3%, tracking global cryptocurrency stocks higher after the Securities and Exchange Commission approved the first US-listed ETFs to track bitcoin.
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Elsewhere across the region, in earlier trade, Sydney, Wellington, Mumbai, Singapore, Taipei, Manila and Jakarta were also well up but Seoul edged back. MSCI’s broadest index of Asia-Pacific shares outside Japan was 0.8% higher, on course to snap its seven-day losing streak.
The exuberant mood is likely to continue in Europe, where Eurostoxx 50 futures were up 0.65%, German DAX futures advanced 0.56% and FTSE futures climbed 0.31%. E-mini futures for the S&P 500 tacked on 0.18%.
Market attention has zeroed in on the US consumer price index report (CPI) due later on Thursday. Core CPI is forecast to remain unchanged at 0.3% from the month before, while year-on-year inflation is expected to slow to 3.8% from November’s 4%, a Reuters poll showed.
Investor focus will also be on the earnings season, with banking giants JPMorgan Chase, Bank of America, Citigroup and Wells Fargo all due to report on Friday.
The US securities regulator late on Wednesday approved the first US-listed ETFs to track bitcoin, in a watershed for the world’s largest cryptocurrency, with most of the products expected to begin trading on Thursday.
On Thursday, bitcoin was little changed and a shade above $46,000, having surged more than 70% since October in anticipation of the decision from the regulator.
The dollar was on the back foot ahead of the US inflation report. The soft dollar helped gold prices, with spot gold up 0.5% at $2,033.92 an ounce.
US crude rose 0.71% to $71.88 per barrel and Brent was at $77.36, up 0.73% on the day, after dropping nearly a dollar in the previous session as a surprise jump in US crude stockpiles raised worries about demand in the largest oil market.
Key figures
Tokyo – Nikkei 225 > UP 1.77% at 35,049.86 (close)
Hong Kong – Hang Seng Index > UP 1.27% at 16,302.04 (close)
Shanghai – Composite > UP 0.31% at 2,886.65 (close)
London – FTSE 100 > UP 0.52% at 7,691.53 (0839 GMT)
New York – Dow > UP 0.45% at 37,695.73 (Wednesday close)
- Reuters with additional editing by Sean O’Meara
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