HONG KONG — Asian markets mainly advanced on Friday after Wall Street recovered most of the week’s earlier losses and Japan reported slowing inflation, which could keep ultra-low interest rates stable.
US futures and oil prices were mixed. The Nikkei 225 index in Tokyo rose 1.3% to 35,940.50.
Japanese inflation has slowed for a second month in a row, increasing the likelihood that the Bank of Japan will keep its ultra-low interest rates unchanged at its meeting next week. The country’s annual headline inflation has been above the BOJ’s 2% target since April 2022, seeing a gradual decline from last year’s peak of 4.3% to the 2.6% in December reported on Friday.
Hong Kong stocks suffered a third straight week of losses as investors remain concerned about the bleak economic outlook. Hong Kong’s Hang Seng lost 0.8% to 15,275.00 and the Shanghai Composite index fell 0.3% to 2,838.89.
In South Korea, the Kospi rose 1.3% to 2,472.74. The Australian S&P/ASX 200 rose 1% to 7,421.20. In Bangkok, the SET rose 0.3%. Taiwan’s Taiex gained 2.6%, while Taiwan Semiconductor Manufacturing Co. 6.5% added.
On Thursday the S&The P500 rose 0.9% to 4,780.94 after consecutive declines that kicked off the holiday week. The Dow Jones Industrial Average rose 0.5% to 37,468.61, and the Nasdaq composite rose 1.3% to 15,055.65.
Big Tech stocks led the way, including Apple, which rose 3.3%, turning its week-to-date losses into gains.
Chip companies were also strong after Taiwan Semiconductor Manufacturing Co. had made a revenue forecast for 2024 that analysts said was higher than they had expected. Broadcom gained 3.6%, while shares of TSMC trading in the United States rose 9.8%.
The market was generally more stable as Treasury yields in the bond market slowed their rise from earlier in the week. Yields had risen as traders trimmed their forecasts of how soon the Federal Reserve will start cutting rates. Higher yields in turn undermine stock prices and increase pressure on the economy.
The Fed has indicated it will likely cut rates several times in 2024 as inflation has cooled from its peak two summers ago, meaning the economy and financial system may not need to be kept on such a tight leash.
The yield on ten-year government bonds rose again on Friday, from 4.11% at the end of Wednesday to 4.16%.
Treasury yields fluctuated up and down in the minutes after a report Thursday morning showed the number of U.S. workers filing for unemployment benefits fell last week to the lowest level since two Septembers ago. That’s good news for workers and for the economy in general, which has so far strengthened predictions for a recession.
Other reports on the economy were mixed Thursday. One showed that output in the mid-Atlantic is shrinking more than economists expected. Another said homebuilders completed more projects last month than economists expected, even though it was weaker than November levels.
On the losing side of Wall Street were several financial companies that reported weaker results for the end of 2023 than analysts expected. Discover Financial Services fell 10.8% and KeyCorp lost 4.6% after both companies reported profits well below Wall Street expectations, although their revenues exceeded expectations.
Helping offset this was Fastenal, which rose 7.2% for the biggest gain in the S&P500. The distributor of safety supplies, fasteners and other products reported a bigger quarterly profit than analysts expected.
In energy trading, U.S. benchmark crude added 3 cents to $73.98 a barrel. Brent crude, the international standard, lost 16 cents to $78.94 a barrel.
The US dollar rose from 148.15 yen to 148.69 Japanese yen. The euro cost $1.0880, up from $1.0874.