Asian stock markets surged following Wall Street’s record highs, sparked by a U.S. inflation report that suggested a more moderate inflation rate, increasing the likelihood of two interest rate cuts by the Federal Reserve this year.
The U.S. dollar weakened, hitting new multi-week lows against currencies like the euro and the British pound.
In Tokyo, U.S. Treasury yields continued to decline, reaching six-week lows, which aided the recovery of the previously struggling Japanese yen. This occurred despite data indicating a larger-than-expected contraction in Japan’s economy in the first quarter.
Gold prices approached record highs, while crude oil prices rose after a significant recovery from a two-month low.
The MSCI broad index of Asia-Pacific shares outside Japan rose by 1.5%. Hong Kong’s Hang Seng and Australia’s main stock index each increased by approximately 1.6%.
Japan’s Nikkei Index also saw a rise of over 1%.
In the U.S., stock indexes reached new records after April’s consumer price index suggested easing inflation, enhancing the prospect of rate cuts by the Federal Reserve.
The three major U.S. stock indexes reached all-time highs. The S&P 500 increased by 1.2% to 5,308.15, the Dow Jones Industrial Average rose by 0.9% to 39,908.00, and the tech-heavy Nasdaq Composite advanced by 1.4% to 16,742.39.
As the recent rally in meme stocks subsided, GameStop shares fell by 18%, and AMC shares declined by 20% at the market close.
