Asian stocks closed with mixed results on Friday, as investor optimism over potential stimulus in China counterbalanced concerns about interest rates and mixed economic data from the country.
The recent downward trend of the U.S. dollar came to a halt after three prominent Federal Reserve officials emphasized the need for patience on rate cuts until there is clear evidence that inflation is returning to the 2 percent target.
In Asian trading, gold and oil maintained modest gains amid the ongoing conflict in Gaza and the U.S. House of Representatives' approval of a bill to compel President Joe Biden to resume arms supplies to Israel.
Chinese markets saw a rally following the announcement of new measures to support the struggling property sector. Shares of China Evergrande Group, the world’s most indebted developer with over $300 billion in borrowings, soared nearly 18 percent. Similarly, China Vanke rose 10 percent after the central bank reduced the minimum down payment rate for first-time homebuyers and suggested possible government purchases of commercial real estate to invigorate the ailing housing market.
The Shanghai Composite Index surged by 1.01 percent to close at 3,154.03, while the Hang Seng Index in Hong Kong climbed 0.91 percent to 19,553.61. Investors largely overlooked the mixed economic data from China, which showed accelerated industrial growth in April contrasted by weaker-than-expected retail sales and fixed asset investment for the January-April period.
In Japan, markets declined following a survey revealing that a majority of Japanese companies are concerned about the adverse effects of a weak yen on their profits. The Nikkei average slipped 0.34 percent to 38,787.38, while the broader Topix index finished 0.30 percent higher at 2,745.62. Tokyo Electron, a chip-making equipment manufacturer, led the losses, closing about 2 percent lower, while Fast Retailing dropped 0.9 percent.
Seoul's stock market fell, led by declines in chip and battery manufacturers. The benchmark Kospi average dropped 1.03 percent to 2,724.62, following a six-week high achieved on Thursday. Major firms such as Samsung Electronics, SK Hynix, LG Energy Solution, and Samsung SDI fell between 1 and 2 percent. Conversely, Samyang Foods surged 30 percent after reporting higher-than-expected earnings for the first quarter.
Australian stocks ended a two-day winning streak, with significant losses in the banking, technology, and healthcare sectors. The benchmark S&P/ASX 200 dropped 0.85 percent to 7,814.40, while the broader All Ordinaries index fell 0.83 percent to 8,082.30.
Across the Tasman Sea, New Zealand’s S&P/NZX 50 index dipped 0.24 percent to 11,699.79, as investors awaited the Reserve Bank of New Zealand’s upcoming monetary policy decision.
In the U.S., stocks closed lower on the previous day, one day after all three major indices had reached record highs, fueled by lower-than-anticipated consumer price inflation data. Economic reports highlighted a cooling job market and unchanged factory output in April. Housing starts, however, rebounded following a significant decline.
The Dow Jones Industrial Average touched an intraday high of 40,000 before closing marginally lower. The S&P 500 decreased by 0.2 percent, and the tech-focused Nasdaq Composite fell by 0.3 percent.
