TOKYO – The Asian markets witnessed a positive trend on Friday as investors remained cautiously optimistic about the future of technology companies and the overall global economic scenario.
Japan’s Nikkei 225 index rose by 0.5% to reach 38,566.40 following encouraging economic data from the world’s fourth-largest economy.
Industrial production in Japan improved by 2.8% in July compared to the previous month, indicating a rebound from the negative growth of 4.2% in June as reported by the Ministry of Economy, Trade, and Industry. While it fell slightly short of market expectations, it still pointed towards growth. On the other hand, the unemployment rate in July rose to 2.7% from 2.5% in June.
Notably, Tokyo’s consumer prices surged more than expected to 2.6% year-on-year in August, up from 2.2% in July, driven by sharp increases in food and utility prices. This development is likely to grab the attention of the Bank of Japan as it contemplates a potential interest rate hike later this year or early next year.
In other markets, Australia’s S&P/ASX 200 and South Korea’s Kospi registered gains, while Hong Kong’s Hang Seng and Shanghai Composite also saw positive movements.
Over on Wall Street, a late dip in some Big Tech stocks led to a mixed finish for U.S. stock indexes. The S&P 500 closed flat, the Dow Jones Industrial Average posted a 0.6% gain reaching a new all-time high, while the Nasdaq Composite slipped marginally.
Despite the mixed performance, gainers outnumbered decliners on the New York Stock Exchange, with companies like Nvidia witnessing a stock price decline despite strong second-quarter results.
The U.S. Commerce Department revised the second-quarter economic growth rate to 3% from the previous estimate of 2.8%, affirming the strength of the economy amidst persistent inflation concerns.
Economists are eagerly awaiting the release of the U.S. government’s July inflation data to gauge the trajectory of the economy. Positive reports from August including retail sales, employment, and consumer confidence suggest a robust second half of the year for the U.S. economy.
Looking ahead, the Federal Reserve is expected to start reducing interest rates, with traders anticipating a series of rate cuts by the end of the year. Bond yields in the Treasury market rose slightly, reflecting market optimism.
Overall, the global markets are showing resilience and investors remain hopeful for a sustained recovery in the coming months.
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