Most Asian stocks rose on Friday amid some strength in technology shares, while Japanese markets held on to mild gains after the Bank of Japan kept interest rates unchanged as expected.
The BOJ hiked its inflation and growth forecasts, with focus now turning to an address by BOJ Governor Kazuo Ueda later in the day.
Regional markets took a positive lead-in from Wall Street, which rebounded for a second straight session after U.S. President Donald Trump tempered his rhetoric over Greenland. But Trump’s comments on a U.S. "armada" heading to Iran tempered some risk in the Asian session, which saw gold prices hit a fresh record high.
S&P 500 Futures rose 0.2% by 23:40 ET (04:40 GMT).
Most Asian markets were still headed for a weak weekly finish, after Trump’s threats over Greenland sparked deep declines at the beginning of the week. Concerns over weakening fiscal health in the developed world also weighed.
South Korea’s KOSPI outperformed its peers this week on strength in tech, while India’s Nifty 50 lagged.
Japan stocks edge higher after BOJ holds rates, hikes outlook
Japan’s Nikkei 225 rose 0.2%, while the TOPIX added 0.4%, with both indexes trimming some gains after the BOJ decision.
The central bank left rates unchanged at 0.75% in a nearly unanimous decision, and hiked its growth and inflation forecasts for fiscal 2025 and 2026, citing support from increased government spending.
Focus is now squarely on Ueda’s press conference later in the day. The BOJ, in its monetary policy statement, largely reiterated its stance that it will raise interest rates as growth and wages gain traction.
The BOJ is expected to remain on hold until at least March or April, when the results of springtime wage negotiations will give the central bank more clarity on the economy and wages.
Soft inflation data for December, released earlier in the day, cast some doubts over the BOJ’s rate hike outlook. Headline consumer price index inflation fell to a near four-year low in December, while underlying inflation remained sticky.
Asia stocks set for muted week; S.Korea outperforms and India lags
Most Asian markets advanced on Friday on strength in tech stocks, especially after positive comments from NVIDIA Corporation (NASDAQ:NVDA) spruced up sentiment towards artificial intelligence.
But most regional markets were set for a muted weekly performance, following mixed growth prints from China, heightened fiscal concerns in Japan, and broader fears over Greenland.
South Korea’s KOSPI rose 0.6% and traded just below a record high on sustained strength in technology and automaking shares. The index was the best performer in Asia this week with a 2.5% gain.
China’s Shanghai Shenzhen CSI 300 and Shanghai Composite indexes moved in a tight range, while Hong Kong’s Hang Seng index added 0.4%.
Australia’s ASX 200 rose 0.3% on Friday, while Singapore’s Straits Times index added 0.9%.
India’s Nifty 50 index fell 0.1% in morning trade, and largely lagged its peers with a 1.6% drop this week.
A U.S.-India trade deal remained elusive, keeping investors cautious towards the Asian country’s markets. A swathe of weak corporate earnings from major Indian firms also weighed on local stocks this week.
Source: Investing