Asia markets rise after Wall Street rallies

Hong Kong jumped more than 1%, while there were also healthy gains in Tokyo, Shanghai, Sydney, Seoul, Singapore, Taipei, Wellington and Manila

Asian markets rose on Friday after a record day on Wall Street, boosted by a strong round of US data that reassured investors over the health of the country’s economy, while focus turns to the release of key inflation numbers.

With the much-hyped earnings report from AI company Nvidia released, traders are once again able to focus on economic matters and the Federal Reserve’s plans for interest rate cuts.

Thursday did not disappoint, with figures showing gross domestic product (GDP) rose more than initially thought in the second quarter, while jobless claims dipped.

The news indicated the central bank was achieving its goal of guiding the economy to a soft landing at the same time as it brings prices under control.

Next up is the Federal Reserve’s preferred gauge of inflation later on Friday, followed by the closely watched non-farm payrolls (NFP) report a week later, which will play a major role in whether the Fed reduces borrowing costs next month and, if so, by how much.

While Fed chair Jerome Powell said last week that it was time to begin reducing rates, some decision-makers remain cautious.

Luca Santos at ACY Securities pointed out that after Powell’s speech, Atlanta Fed boss Raphael Bostic hinted at a cautious stance regarding a rate cut in September, stressing the need for more data to avoid making a move that could lead to more rate hikes down the line.

His comments underscore how pivotal the upcoming jobs report will be in determining the Fed’s next steps, he said.

Asia was on course to close the week on a somewhat brighter note, with tech companies that took a hit on Thursday as part of an Nvidia-driven pullback paring back some of their losses.

Hong Kong jumped more than 1%, while there were also healthy gains in Tokyo, Shanghai, Sydney, Seoul, Singapore, Taipei, Wellington and Manila.