HONG KONG (AP) — Asian equities increased on Friday after the most recent drop on Wall Street, where the S&P 500 declined to its lowest point in five months.Thank you for reading this post, don't forget to subscribe!
US futures rose and oil prices surged over $1 after the Israeli military said its troops and tanks had briefly entered northern Gaza.
Japan’s Nikkei 225 index surged 1.1% to 30,948.49, as an unexpectedly high reading for consumer inflation in Tokyo raised hopes the central bank might finally terminate its long-standing near-zero interest rate policy.
Tokyo Core consumer inflation, which excludes volatile fresh food prices, increased 2.7% in October, the statistics bureau reported Friday. As a leading indicator of nationwide trends, it suggests a broad trend of rising prices.
Chinese stocks also ended their recent decline as profits at China’s industrial companies increased nearly 12% in September for the second consecutive month, after the government announced policy measures to aid in stabilizing the decelerating economy.
Industrial profits expanded 17.2% in August in the first growth in over a year.
The Hang Seng in Hong Kong ascended 2.1% to 17,403.03, concluding a successful week in the market, and the Shanghai Composite Index rose 1.1% to 3,019.72.
The Kospi in Seoul rose 0.2% to 2,302.81. Australia’s S&P/ASX 200 was up 0.2% at 6,826.90. Taiwan’s TAIEX was 0.4% higher and Bangkok’s SET was almost flat.
Wall Street experienced a retreat on Thursday, declining nearly 10% from its peak for the year after prominent companies cautioned that the uncertain global economy could harm their profits.
The S&P 500 declined 1.2% to 4,137.23, its ninth decline in 11 days. Another substantial decline for Big Tech dragged the Nasdaq Composite down 1.8% to 12.595.61. The Dow Jones Industrial Average fell 0.8% to 32,784.30.
The meta platform was one of the market’s most significant burdens, falling 3.7%, despite the parent company of Facebook and Instagram reporting summer profit and revenue that surpassed analysts’ expectations.
Investors may have been concerned by the company’s warning that there has been some initial weakness in advertising due to the latest Israel-Hamas war, and analysts noted that the company has provided a wider range than in the past for its upcoming revenue forecast.
The yield on the 10-year Treasury fell to 4.85% from 4.96% late Wednesday on reports that the US economy continues to expand despite very high interest rates that have already impacted the stock market.
Preliminary estimates indicate that the US economy grew by 4.9% during the summer. This exceeded economists’ expectations. A separate report indicated that the US job market remains exceptionally strong, with relatively few layoffs nationwide.
Thursday’s reports demonstrated that the US economy is clearly not in a recession. However, investors are more worried about potential future events rather than past occurrences, and they fear that a robust economy could drive prices higher. This could prompt the Fed to keep rates higher for an extended period to control inflation.
Higher interest rates could eventually lead to weakness in the economy and corporate profits. Additionally, higher bond yields make investors less inclined to pay higher prices for stocks and other investments.
Treasury yields edged higher as they approached the main interest rate controlled by the Federal Reserve, which is at its highest level since 2001.
In the short term, traders are highly optimistic that the Federal Reserve will maintain steady rates at its next meeting, which concludes on Wednesday. This will be the second consecutive meeting in which the Fed has not raised its key interest rate, which it raised from near zero to 5.25% early last year.
Even better-than-expected profits from prominent US companies have not been sufficient to halt Wall Street’s recent decline.
Most companies in the S&P 500 have surpassed analysts’ profit expectations for the summer and are projected to post their first overall growth in a year. However, the stock prices of numerous prominent companies fell on Thursday following disappointing results or predictions of upcoming trends.
In other trading on Friday, US benchmark crude rose $1.34 to $84.55 a barrel in electronic trading on the New York Mercantile Exchange. It dropped to $2.18 on Thursday.
Brent crude, the international standard, rose $1.26 to $88.31 a barrel. It declined by $2.07 on Thursday.
The dollar fell to 150.24 JPY from 150.39 yen. The euro declined to $1.0559 from $1.0565.
Zimo Zhong, The Associated Press