Most Asian shares rose on Friday, tracking an overnight rally on Wall Street, as strong U.S. economic data helped ease recession fears, while bets on interest rate cuts remained intact.
Wall Street indexes rose sharply on Thursday after strong retail sales data boosted optimism about the U.S. economy. Weaker inflation data earlier in the week also kept traders expecting a 25 basis point interest rate cut in September.
U.S. stock index futures rose in Asian trading.
Japan’s Nikkei leads Asia gains, set for big week
Japanese and US stock indices were the best performers in Asia, up 3.2% and 2.5% respectively. They were also the best performers in Asia this week.
Both indices were set to add between 7% and 8.5% this week, as they recovered from four straight weeks of steep losses, which also saw them enter a bear market.
Sentiment towards Japan improved this week on the back of stronger-than-expected second-quarter data, which showed the economy is starting to recover amid improving wages and personal spending.
But Japanese stocks remained in a bear market they entered last week, with analysts at JPMorgan warning that recent gains were mainly driven by domestic buying, and that foreign investors remained cautious about buying back into Japan.
Hong Kong shares rise on strong earnings, China lags
Hong Kong’s index rose 1.6%, helped by a nearly 8% rise in JD.com (HK:) (NASDAQ:) after the online retailer reported much stronger-than-expected third-quarter profit.
competition alibaba Alibaba Group (HK:) (NYSE:) rose 3.6% even as second-quarter earnings missed estimates. The stock was boosted by speculation that Alibaba will upgrade its Hong Kong listing to make it eligible for purchase by Chinese investors later this month, which could attract a wave of inflows into the stock by linking the shares south.
But Chinese markets lagged as mixed economic readings from the country kept investors from buying local stocks. Chinese and Asian stock indexes rose about 0.1%.
Chinese stocks received little support from further stimulus pledges from the People’s Bank of China. The central bank is due to set its benchmark interest rate next week, after an unexpected rate cut in July to boost growth.
Asian markets rose more broadly, as weaker prospects for a U.S. recession and continued bets on U.S. interest rate cuts supported risk-on assets.
Australian shares rose 1.3%, while South Korean shares rose 1.8% in catch-up trade.
India index futures pointed to a strong opening, with the index also set to rise sharply after Thursday’s holiday.
Comments are closed, but trackbacks and pingbacks are open.