Asian stock markets are trading mostly higher on Friday, following the broadly positive cues from global markets overnight, as a sharp increase in the price of crude oil contributed to significant strength. The U.S. dollar also retreated and shed ground against most of its Asian major counterparts. Asian markets ended mostly lower on Thursday.
The hot U.S. inflation data raised concerns about aggressive rate hike by the US Fed, but traders presumably felt concerns about inflation and higher interest rates have already been priced into the markets following the recent downward trend.
The report showed consumer prices rose by more than expected in September, leading to a spike in treasury yields and ongoing concerns about the outlook for interest rates.
“The disappointingly broad-based and high inflation readings will keep the Fed in an aggressive tightening mode and on course for at least another 125bps this year,” said Kathy Bostjancic, Chief U.S. Financial Economist at Oxford Economics.
The Australian stock market is sharply higher on Friday, recouping the slight losses in the previous session, with the benchmark S&P/ASX 200 moving above the 6,700 level, following the broadly positive cues from global markets overnight, with strong gains across most sectors, led by energy and iron ore miner stocks amid a spike in commodity prices. Financial stocks are also gaining.
The US inflation data coming in hotter than expected in September is weighing on market sentiment, but traders feel concerns about inflation and higher interest rates have already been priced into the markets.
The benchmark S&P/ASX 200 Index is gaining 125.80 points or 1.90 percent to 6,768.40, after touching a high of 6,771.80 earlier. The broader All Ordinaries Index is up 122.90 points or 1.80 percent to 6,957.40. Australian markets ended slightly lower on Thursday.
Among major miners, BHP Group and Mineral Resources are gaining almost 2 percent each, while Rio Tinto is adding more than 1 percent. OZ Minerals and Fortescue Metals are edging up 0.4 percent.
Oil stocks are mostly higher. Origin Energy is gaining almost 3 percent, Beach energy is adding more than 4 percent, Woodside Energy is advancing almost 4 percent and Santos is rising more than 3 percent.
Among tech stocks, Zip is gaining almost 1 percent, WiseTech Global is gaining more than 3 percent and Xero is adding more than 1 percent, while Afterpay owner Block is losing almost 1 percent. Appen is flat.
Among the big four banks, National Australia Bank and Westpac are gaining 1.5 percent each, while Commonwealth Bank and ANZ Banking are adding more than 1 percent each.
Gold miners are mostly lower. Newcrest Mining is losing almost 1 percent and Gold Road Resources is declining more than 2 percent, while Evolution Mining and Northern Star Resources are edging down 0.5 percent each. Resolute Mining is gaining more than 2 percent.
In the currency market, the Aussie dollar is trading at $0.633 on Friday.
The Japanese stock market is sharply higher on Friday, snapping a four-session losing streak, with the benchmark Nikkei 225 surging 900 points to break above the 27,000 mark, following the broadly positive cues from global markets overnight, with sharp gains across most sectors, led by exporters and technology stocks, despite US inflation data coming in hotter than expected in September. The yen also hit a 24-year low against the dollar.
The benchmark Nikkei 225 Index closed the morning session at 27,141.18, up 900.76 points or 3.44 percent, after touching a high of 27,146.68. Japanese stocks closed significantly lower on Thursday.
Market heavyweight SoftBank Group is gaining more than 4 percent and Uniqlo operator Fast Retailing is surging almost 7 percent after posting a profit for the full year. Among automakers, Honda is adding almost 2 percent and Toyota is up more than 1 percent.
In the tech space, Advantest and Tokyo Electron are gaining almost 2 percent each, while Screen Holdings is edging down 0.1 percent.
In the banking sector, Mizuho Financial is gaining more than 1 percent, while Sumitomo Mitsui Financial and Mitsubishi UFJ Financial are advancing more than 2 percent each.
Among major exporters, Canon is gaining more than 2 percent, Mitsubishi Electric is adding more than 3 percent, Panasonic is advancing almost 3 percent and Sony is surging almost 5 percent after inking a JV with Honda to produce premium electric vehicles in 2025.
Among the other major gainers, Mitsubishi Motors is surging more than 5 percent, while NTT Data, TDK and Dentsu Group are gaining almost 5 percent each. Eisai Co., Rakuten, Hoya, Yamaha, and Olympus are all adding more than 4 percent each, while Nissan Motor, Ricoh and Daiichi Sankyo are up almost 4 percent each.
Conversely, there are no major losers.
In the currency market, the U.S. dollar is trading in the lower 147 yen-range on Friday.
Elsewhere in Asia, Hong Kong is soaring 3.1 percent, while South Korea and Taiwan are surging 2.5 and 2.8 percent, respectively. China and Singapore are up 1.6 and 1.1 percent, respectively. New Zealand, Malaysia and Indonesia are higher by between 0.4 and 1.0 percent each.
On Wall Street, stocks showed a substantial turnaround over the course of the trading session on Thursday following an early sell-off, stocks. The major averages climbed well off their lows of the session and firmly into positive territory.
The major averages finished the session not far off their best levels of the day. After plunging by nearly 550 points in early trading, the Dow spiked 827.87 points or 2.8 percent to 30,038.72. The Nasdaq also surged 232.05 points or 2.2 percent to 10,649.15, while the S&P 500 jumped 92.88 points or 2.6 percent to 3,669.91.
The major European markets also moved to the upside over the course of the session. While the German DAX Index surged by 1.5 percent, the French CAC 40 Index jumped by 1.0 percent and the U.K.’s FTSE 100 Index rose by 0.4 percent.
Crude oil futures settled higher on Thursday, gaining after three straight days of losses, as data showed a significant drop in distillate inventories in the U.S. in the week ended October 7. Oil prices drifted lower over the past three sessions amid concerns about the outlook for energy demand due to the rising possibility of a global recession. West Texas Intermediate crude oil futures ended higher by $1.84 or about 2.1 percent at $89.11 a barrel.
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