Asian Stocks to Rise as Global Gauge Hits New Peak: Markets Wrap
Asian stocks were primed for early gains Friday after US and global equity gauges hit fresh highs as easing policy supported bullish sentiment.
Equity index futures for Japan, Australia and Hong Kong advanced, in a sign of robust risk appetite. The , , and small-cap index all closed together at fresh highs for the first time since November 2021. An MSCI index of global stocks also closed at a record.
US equity gains were helped along by a strong day for tech stocks. A $5 billion investment from in drove the ailing chipmaker . , meanwhile, its full-year profit outlook, leading its shares to rally in after-hours trading Thursday.
The upbeat mood reflected expectations for further Federal Reserve rate cuts alongside an economy and jobs market that for now remains relatively resilient. Thursday data showed jobless claims by the most in nearly four years, suggesting US companies are still holding onto workers.
“The Fed is cutting interest rates during a time when stocks are at record highs and the economy is still growing,” said Robert Schein at Blanke Schein Wealth Management. “This dynamic is bullish for stocks.”
Treasuries sold off slightly across the curve Thursday. The US 10-year yield rose two basis points, supporting an of the dollar, which ended the session higher for a second day.
The yen was steady after weakening against the greenback Thursday, ahead of inflation data and a Bank of Japan interest rate decision due Friday. Economists polled by Bloomberg anticipate Japan’s central bank will leave its target interest rate unchanged at 0.5%. BOJ watchers will be as to the likelihood of a move next month or in December.
Elsewhere in Asia, data for release includes trade for Malaysia and a China FX net settlement figures.
In corporate news, raised its for 2025 while paring profit expectations as the South Korean automaker accelerates investment in the US to mitigate tariff costs. India’s securities market regulator the Adani Group and its billionaire founder Gautam Adani of some allegations of impropriety.
US Rally
Worries have been mounting for weeks that the S&P 500’s push to record after record risks becoming a bubble, with the index’s swollen valuation cited most often as cause for concern.
Critics point to the tech sector’s outsize influence on this year’s gain, with just five stocks, all megacap tech firms, driving about half of the advance. But a closer look shows tech giants have largely justified their elevated valuations with profit growth.
“Investors have happily bought every dip, largely thanks to AI-driven enthusiasm and consistently strong results from big tech,” said Fawad Razaqzada at City Index and Forex.com. “The concern is that if tech momentum cools, the rest of the market may struggle to justify current valuations.”
That leaves the rally vulnerable if investor confidence wavers, putting the S&P 500 forecast on a more cautious stance, he noted.
“Our base case remains that the US economy will remain resilient and that it is unlikely to spiral into a recession,” said David Lefkowitz at UBS Global Wealth Management. “We therefore believe stocks are poised for further gains.”
In commodities, gold fell for a second session Thursday, as did West Texas Intermediate, the US oil price. Declines for crude came as US President Donald Trump implied that he over sanctions as a means of pressuring Russia to end its war in Ukraine.
Some of the main moves in markets:
Stocks
Currencies
Cryptocurrencies
Commodities
This story was produced with the assistance of Bloomberg Automation.
