Asian stocks posted broad gains on Thursday, with China leading the advance thanks to strong performance in the technology and semiconductor sectors, while Japan’s Nikkei continued to notch fresh record highs. Market sentiment was boosted by optimism over global demand for artificial intelligence technologies, alongside growing bets on upcoming U.S. interest rate cuts.
In Japan, the Nikkei 225 surged over 1%, surpassing the 44,000 mark for the second time this week, supported by broad gains in technology, energy, and utilities stocks. The rally came after Prime Minister Shigeru Ishiba resigned following election losses and internal party pressures, fueling expectations that the new government will pursue more expansionary fiscal and monetary policies. In China, the Shanghai Composite gained 1.1% and the CSI 300 rose nearly 2%, driven by chipmakers, while Hong Kong’s Hang Seng pared losses to close near a four year high.
On the currency front, most Asian currencies came under mild pressure with slight declines, while the U.S. dollar held steady after a volatile session. The USD/JPY pair traded at 147.46 following Japanese producer price index data that showed a 0.2% monthly decline in August but a 2.7% annual increase.
Although persistent wholesale inflation could push the Bank of Japan to consider a rate hike, political uncertainty after the Prime Minister’s resignation has limited such expectations. Meanwhile, the U.S. dollar recovered most of its losses from weak producer price data, with markets awaiting consumer inflation figures expected to show annual CPI rising to 2.9% while core CPI holds at 3.1%.
Globally, Japanese, South Korean, and Taiwanese equities extended record setting runs, underpinned by the technology sector. SoftBank jumped nearly 10%, tracking Oracle’s historic 36% rally on Wall Street its biggest one day gain since 1992 after the tech giant forecast a surge in cloud demand from AI companies. In Europe, sentiment was more cautious, with EUROSTOXX 50 futures steady ahead of the ECB’s policy decision, where rates are expected to be left unchanged but attention will focus on the tone of the statement.
In commodities, oil prices retreated after sharp gains in the prior session, with U.S. crude falling to $63.45 a barrel and Brent to $67.26, pressured by geopolitical tensions related to Russia and U.S. efforts to push for tougher sanctions on Russian oil buyers. Gold also slipped to $3,630 an ounce, pulling further away from record highs as investors shifted toward riskier assets, supported by improving risk appetite and stronger equity market sentiment.
Stay informed about global markets through our previous analyses. and Now, you can also benefit from LDN company services via the LDN Global Markets trading platform.
