Asian markets experienced widespread gains on Friday, buoyed by U.S. President Donald Trump's conciliatory tone toward China. In a recent interview, Trump described his conversation with Chinese President Xi Jinping as amicable and expressed a preference against imposing tariffs on China, hinting at a more lenient approach to trade duties.
In Asia, gold prices remained elevated, nearing historic highs, as the U.S. dollar weakened following Trump's appeal for the Federal Reserve to implement immediate interest rate reductions.
Conversely, the oil market displayed indecisiveness. Trump's remarks suggested that lower oil prices might quickly resolve the conflict in Ukraine and stated his intention to urge Saudi Arabia and OPEC to reduce oil costs.
China's Shanghai Composite index advanced by 0.70 percent, reaching 3,252.63. This gain followed the China Securities Regulatory Commission's directive that mutual funds should annually increase their onshore stock holdings by at least 10 percent over the next three years. Additionally, large state-owned insurers are required to allocate 30 percent of their new policy premiums to stock markets starting this year.
Hong Kong's Hang Seng index shot up by 1.86 percent, closing at 20,066.19, propelled by strong performances from tech giants such as Tencent and Baidu.
Japanese markets relinquished early gains to end the day unchanged. The Bank of Japan raised its short-term interest rate target by 25 basis points as anticipated, with new data showing core inflation last month at its fastest rate in 16 months.
In response to the central bank's interest rate increase, the yen appreciated and bond yields rose, reaching heights not seen since the 2008 global financial crisis. The bank also adjusted its inflation outlook and indicated possible further rate hikes if GDP and price growth meet projections. Consequently, the Nikkei and the broader Topix index both closed slightly down at 39,931.98 and 2,751.04, respectively.
Shares of Mitsubishi Motors plummeted by 6.9 percent amid reports that it will not participate in Honda Motor Co. and Nissan Motor Co.'s proposed consolidation under a holding company.
South Korean equities saw significant gains, with the Kospi index ending 0.85 percent higher at 2,536.80. Korea Zinc surged 11.6 percent after Chairman Choi Yun-beom maintained control during a shareholders' meeting on January 23.
In Australia, markets posted modest increases, closing just below record highs before a long weekend. The S&P/ASX 200 rose by 0.36 percent, reaching 8,408.90, led primarily by consumer discretionary stocks. The broader All Ordinaries index also gained 0.36 percent, settling at 8,660.40. Premier Investments soared 6.6 percent following a landmark agreement with Myer on Thursday.
Contrasting the positive trend, New Zealand's benchmark S&P/NZX-50 index fell by 0.27 percent to 13,024.70.
In the U.S., stocks recorded their fourth consecutive day of gains. Investors responded to a mix of corporate earnings reports and Trump's comments at the World Economic Forum in Davos, Switzerland. Trump cautioned global business leaders about potential tariffs on products manufactured outside the U.S. Furthermore, he reiterated his intent to pressure the Federal Reserve for immediate interest rate reductions and to request OPEC and Saudi Arabia to decrease oil prices. Consequently, the S&P 500 climbed by half a percent, achieving a new record closing high, while the Dow rose by 0.9 percent, and the Nasdaq Composite, dominated by technology stocks, inched up by 0.2 percent.
