Investing.com — Most Asian stocks were rangebound on Wednesday as markets digested mixed inflation data from China and Japan, while the focus remained on when the Federal Reserve will start cutting interest rates.
Regional stocks received moderate signals from Wall Street, with technology stocks seeing sharp gains and nearing new record highs. But Wall Street’s pace of gains has been slowing.
U.S. stock index futures were steady in Asian trading as investors digested testimony from Federal Reserve Chairman Jerome Powell. Powell pointed to some slowdown in the economy but offered no clear indications on when the central bank will start cutting interest rates. Still, traders maintained their bets on a September rate cut.
Powell is scheduled to speak on Wednesday, while the focus is also on key US data this week.
Asian markets faced mixed inflation data from China and Japan.
Japanese stocks stumble to record highs on mixed producer price inflation
Japan’s Nikkei 225 index moved sideways on Wednesday, briefly hitting a record high of 41,777.50, while the broader index rose 0.2% and also briefly hit a record high.
Recent gains in Japanese markets have been largely driven by foreign buying, amid sharp declines in the yen and as investors bet on a dovish outlook from the Bank of Japan.
But data released on Wednesday showed that inflation in Japan picked up slightly in June, with the annual rate rising to 2.9%.
But the monthly PPI inflation rate rose less than expected at 0.2%.
The reading indicated that while Japanese inflation is increasing, it remains sluggish, raising doubts about whether it could eventually pressure the Bank of Japan to tighten monetary policy further.
Chinese stocks mixed as CPI data disappoints but PPI improves
China’s index rose 0.2%, while it fell 0.1%. Hong Kong’s index jumped 0.8% after recovering from its lowest levels in more than two months.
China’s inflation rate contracted in June from the previous month, as consumer spending weakened amid lingering concerns about the economic recovery.
But China’s manufacturing sector growth contracted at its slowest pace in 16 months, suggesting that Chinese factories are benefiting from ongoing government stimulus measures.
However, data on Wednesday showed that China’s overall deflationary trend remains intact, denting confidence in the country. Chinese stocks have been suffering sharp losses in recent weeks as sentiment has been eroded by concerns about a trade war with the West.
The Chinese language, due out Friday, is now in focus.
Broader Asian markets moved in a flat-to-low range as optimism over U.S. interest rate cuts slowed.
Australia’s index fell 0.3%, while South Korea’s index fell 0.2%.
India index futures pointed to a somewhat positive opening as the index and stock market continued to hit record highs amid continued confidence in the Indian economy, the fastest growing major economy in the past two years.