Asian stock markets climbed as U.S. equities halted a two-day decline, supported by favorable inflation data that raised expectations for a Federal Reserve interest rate cut later this month.
Japanese and Hong Kong shares led the regional gains, with the MSCI Asia Pacific index set for its highest close in over a month. The rally was largely driven by technology stocks, following the Nasdaq 100’s record surge on Wednesday.
Australian government bond yields rose, and the Australian dollar strengthened after economic data showed higher-than-expected job growth and a surprising drop in unemployment. U.S. Treasury yields also edged upward.
In the foreign exchange markets, the South Korean won weakened amid ongoing political instability. President Yoon Suk Yeol accused the opposition of attempting to paralyze his administration and aligning with North Korea during a defiant speech, while the leader of his own party called for his impeachment.
Chinese stocks were on track for a third consecutive week of gains as investors awaited details from a two-day Central Economic Work Conference, expected to outline policies for the coming year following recent stimulus signals from top officials.
Chinese authorities also set a stronger-than-anticipated yuan fixing on Thursday, further supporting the currency after it fell following a Reuters report that China is considering foreign exchange depreciation next year.
The Japanese yen slightly reduced its earlier gains, remaining mostly unchanged. Bank of Japan officials indicated that delaying interest rate hikes carries minimal risk, though they remain open to a possible increase next week based on economic data and market developments, according to sources.
On Wall Street, the S&P 500 rose by 0.8% to 6,084.19, approaching its all-time high. Major technology stocks propelled the Nasdaq Composite up 1.8%, surpassing the 20,000 mark for the first time and closing at 20,034.89. The Dow Jones Industrial Average lagged behind, declining by 0.2% to close at 44,148.56.
In the bond market, the yield on 10-year U.S. Treasury notes increased to 4.27% from 4.23% late Tuesday.
