Stock market today: Asian shares shrug off latest Wall St rout as Chinese factory activity weakens.
Asian shares were higher on Friday as investors shrugged off another decline on Wall Street, while an official survey showed a weakening in Chinese factory activity.
Tokyo’s Nikkei 225 rose 1.2% to 38,119.96, amid reports of plans for big investments by government-backed pension funds and other large institutional investors.
Financial news outlet Nikkei said Japan is preparing to pour nearly 100 trillion yen ($638 billion) more government money into the markets, following the lead of the Government Pension Investment Fund.
Chinese shares rose despite the survey showing further pressure on an economy already suffering from a protracted real estate crisis. But negative indicators often fuel speculation that these will prompt Beijing to counter with pro-growth policies.
Hong Kong’s Hang Seng index rose 1.2% to 18,446.05 and the Shanghai Composite index rose 0.3% to 3,099.72.
The Australian S&The P/ASX 200 rose 0.5% to 7,668.90 and the Kospi in Seoul rose 0.4% to 2,646.44
Taiwan’s Taiex fell 0.9%, while shares in the market’s biggest heavyweight, computer chip maker Taiwan Semiconductor Manufacturing Corp., fell 2%, following declines for other major technology companies.
That followed a 3.8% decline for Nvidia on Thursday after huge gains driven by Wall Street’s frenzy over artificial intelligence technology.
Nvidia’s loss sent the Nasdaq composite down 1.1%, while the S&The P 500 fell 0.6%, even as most stocks within the index and on Wall Street were higher. The Dow Jones Industrial Average fell 0.9%.
A monthly update on an inflation gauge the Federal Reserve prefers to use will be released Friday. The tail end of earnings reporting is another driver for the market. Earnings were largely better than expected for early 2024.
The market was supported on Thursday by better-than-expected earnings reports from a number of companies. Best Buy exceeded expectations even though revenue fell short last quarter and the stock rose 13.4%. Foot Locker rose 15% after also reporting better-than-expected profit, despite revenue falling short of analyst expectations.
Stocks also got a boost largely from the easing of Treasury yields in the bond market, providing relief after rising earlier this week on concerns about tepid demand for government bonds following several U.S. government auctions. Higher interest rates put downward pressure on all kinds of investments.
Yields fell on Thursday after a number of reports showed that the US economy is not as strong as expected.
One report showed that more U.S. workers filed for unemployment benefits last week than expected, though layoffs are still low compared to history. Another suggested that growth in the overall U.S. economy may not have been as strong as previously thought.
A slowdown in the economy could give the Federal Reserve more confidence that inflation will fall sustainably to the 2% target. That, in turn, could convince the country to cut the federal funds rate, which is at its highest level in more than two decades.
The yield on the 10-year Treasury bond fell to 4.54% from 4.62% late Wednesday. The two-year yield, which better tracks expectations of Fed action, fell to 4.92% from 4.98%.
Among other gainers, C3.ai rose 19.4% after the software company beat expectations for both profit and revenue in the latest quarter. HP gained 17% after adjusting previous profit expectations.
Many retailers are also reporting, as they usually do to close out each earnings season, and scrutiny is high amid concerns about whether U.S. households can continue to spend. Still high inflation is hurting them, especially those with lower incomes.
In other trades early Friday, U.S. benchmark crude lost 28 cents to $77.63 a barrel in electronic trading on the New York Mercantile Exchange. Brent crude, the international standard, lost 21 cents to $81.67 a barrel.
The US dollar fell from 156.82 yen to 156.78 Japanese yen. The euro fell from $1.0834 to $1.0822.