Asian stocks advanced on Friday, with optimism about receding inflation in the U.S. and China stimulus hopes aiding sentiment.
Traders also awaited the unofficial start of the second-quarter U.S. earnings season, with financial giants Citigroup, JPMorgan Chase and Wells Fargo due to release their quarterly results before the start of trading.
The dollar lingered near 15-month lows on rising bets that the U.S. monetary tightening cycle is nearing an end.
Gold was on track for its biggest weekly gain since April, while oil prices were set for a third weekly gain, drawing support from tighter supply amid issues in Libya and Nigeria and signs of easing U.S. inflation.
Chinese shares fluctuated before finishing marginally higher on optimism about stronger efforts to bolster the economy. Hong Kong’s Hang Seng Index edged up 0.3 percent to 19,413.78.
China’s central bank will use policy tools such as the reserve requirement ratio (RRR) and medium-term lending facility to weather the challenges facing the world’s second-largest economy, a senior bank official said today.
Japanese shares ended flat with a negative bias as the yen rallied for a seventh day on speculation that the Bank of Japan would tweak its policy, as inflation is stronger than expected.
The Nikkei 225 Index reversed course to end marginally lower at 32,391.26 amid apprehensions about the upcoming BOJ’s policy meeting starting July 27. The broader Topix slipped 0.2 percent to 2,239.10.
Uniqlo-parent Fast Retailing fell 2.1 percent despite reporting record third-quarter profits and raising its full-year forecast. Technology investor SoftBank Group lost 2 percent, while chip-related firm Advantest surged 5.7 percent.
Machinery maker Takisawa Machine Tool soared more than 25 percent after electric motor maker Nidec announced a takeover plan for the firm.
Seoul stocks rose for a fourth consecutive session on easing inflation concerns. The Kospi jumped 1.4 percent to 2,628.30, with Samsung Electronics and SK Hynix rallying 2-3 percent.
Australian stocks rose notably, and the Aussie dollar held gains against its counterpart after the government named Michele Bullock as the new central bank governor.
The benchmark S&P/ASX 200 Index gained 0.8 percent to close at 7,303.10, led by mining and technology stocks. The broader All Ordinaries Index finished 0.8 percent higher at 7,517.10.
Markets in New Zealand were closed for a public holiday.
U.S. stocks closed higher overnight to build on Wednesday’s sharp gains, while the dollar and Treasury yields extended their slide after producer inflation data showed the smallest annual increase in prices in nearly three years, adding to bets the Fed could soon end its monetary tightening campaign.
Meanwhile, weekly jobless claims unexpectedly fell, suggesting a tight labor market.
The tech-heavy Nasdaq Composite and the S&P 500 jumped 1.6 percent and 0.9 percent, respectively to reach their best closing levels in over a year, while the Dow inched up 0.1 percent.
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