Asia report: Markets buoyant on global tech rally

12th Sep 2024 10:25

(Sharecast News) - Asian markets experienced a broadly positive trading session today, with gains driven primarily by a tech rally that spread across the region following strong performances on Wall Street overnight.

Japan's markets led the surge, boosted by renewed enthusiasm in AI-related stocks, while other major markets in the Asia-Pacific saw mixed results.

"Asian equities followed Wall Street's lead, advancing on Thursday as global traders calmly anticipated next week's Fed rate decision," said SPI Asset Management managing partner Stephen Innes.

"The consensus for a 25 basis point cut is a relief for investors, who seem happy to see the end of the 'jumbo cut' debate for now, knowing the Fed's playbook still leaves the door wide open for further easing.

"The 'Fed put' is alive and well, ensuring that markets will get the larger cuts they crave sooner or later if needed."

Most markets rise on back of Wall Street surge

In Japan, the Nikkei 225 jumped 3.41% to close at 36,833.27, with tech stocks rallying.

Ebara, IHI Corporation, and Advantest were among the top performers, surging by 11.49%, 10.35%, and 9.2%, respectively.

The broader Topix index also saw significant gains, rising 2.44% to 2,592.50.

China's markets, however, struggled.

The Shanghai Composite edged down 0.17% to 2,717.12, and the Shenzhen Component dropped 0.63% to 8,054.24.

Several stocks, including LBX Pharmacy Chain, Shanghai Qiangsheng Holding, and Dazhong Transportation Group, plunged by around 10%, dragging down the Shanghai market.

Hong Kong's Hang Seng Index gained 0.7% to 17,240.39, with biotech and financials leading the charge.

WuXi AppTec, AIA Group, and WuXi Biologics were among the top gainers, advancing by 5.96%, 3.67%, and 3.36%, respectively.

In South Korea, the Kospi 100 climbed 2.49% to 2,591.55, with notable gains from Doosan Enerbility, up 8.19%; Posco ICT, ahead 8.1%; and Kumyang, which advanced 7.88%, further boosting market sentiment in the region.

Australia's S&P/ASX 200 added 1.1% to close at 8,075.70, with resource stocks leading the rally.

Paladin Energy surged 9.14%, while Nickel Industries and Mineral Resources advanced 9.09% and 8.26%, respectively.

New Zealand's S&P/NZX 50 also posted gains, rising 1.49% to 12,820.28, with Argosy Property up 3.57%, Sky Network Television adding 3.44%, and Scales Corporation closing 3.33% firmer.

In currency markets, the dollar was last 0.22% stronger on the yen to trade at JPY 142.67, while it gained -0.04% on the Kiwi to NZD 1.6301.

The greenback was slightly weaker against its Australian counterpart, however, slipping 0.03% to change hands at AUD 1.4978.

On the oil front, Brent crude futures were last up 1.09% on ICE at $71.38 per barrel, while the NYMEX quote for West Texas Intermediate added 1.16% to $68.09.

Producer prices rise less than expected in Japan

In economic news, Japan's producer price index (PPI) rose 2.5% year-on-year in August, marking a slower increase than the 2.8% forecast by analysts and down from the 3% recorded in July.

The deceleration in wholesale price growth was one of several economic indicators under close scrutiny by the Bank of Japan.

BoJ officials had already indicated plans to continue raising interest rates in the near future as part of their efforts to manage inflationary pressures in the economy.

The lower-than-expected PPI figure could influence the timing and pace of these anticipated rate hikes.

Reporting by Josh White for Sharecast.com.