Asian stock markets predominantly experienced an upward trend on Friday, as they took cues from Wall Street's positive performance the previous night. It is worth noting that the markets in China, Hong Kong, and Taiwan were closed for the Lunar New Year holiday. The markets responded favorably to domestic economic data from Japan and Australia, with notable gains in the tech sector and an increase in metal prices bolstering mining stocks. On Thursday, Asian markets largely closed on a higher note.
In Australia, the stock market made modest gains on Friday, continuing the positive momentum from the past two sessions, aligning with the general positive sentiment following Wall Street's performance. The S&P/ASX 200 index rose above the 8,500 level, reaching new all-time highs. This growth was driven by gains in mining and technology stocks, although financial stocks showed weakness.
Specifically, the S&P/ASX 200 Index climbed 32.90 points or 0.39% to settle at 8,526.60, after peaking at an all-time high of 8,566.90 earlier. The broader All Ordinaries Index increased by 39.20 points or 0.44% to 8,785.10. Australian equities posted significant gains on Thursday.
In the mining sector, BHP Group grew by over 1%, Rio Tinto increased by nearly 1%, and Fortescue Metals rose by 0.4%. However, Mineral Resources saw a decline of nearly 1%.
Oil stocks showed a mixed response. Origin Energy fell by almost 6%, and Santos decreased by 0.2%, whereas Woodside Energy and Beach Energy registered slight increases between 0.3% and 0.5%.
In the tech sector, WiseTech Global rose by about 1%, Xero advanced by over 2%, and Zip increased by more than 1%. Notably, Appen surged by over 13% after announcing strong quarterly results, while Block, the Afterpay owner, was in a trading halt.
Regarding the major banks, Commonwealth Bank and Westpac saw marginal declines ranging from 0.1% to 0.2%. ANZ Banking decreased by nearly 1%, whereas National Australia Bank gained 0.1%. Most gold mining stocks were on the rise, with Evolution Mining and Northern Star Resources each climbing around 3%. Resolute Mining increased by more than 1%, Newmont added almost 4%, and Gold Road Resources remained steady.
From an economic standpoint, the Australian Bureau of Statistics reported that Australia's final demand producer prices rose by 0.8% in the fourth quarter of 2024, below the anticipated 1.0% and a decrease from 0.9% in the third quarter. Annually, producer prices grew by 3.7%, down from 3.9% in the previous quarter.
Private sector credit in Australia grew by a seasonally adjusted 0.6% in December, according to the Reserve Bank of Australia, matching the previous month and surpassing the expected 0.5% growth. Year-over-year, private sector credit increased by 8.6%.
The Australian dollar was trading at $0.621 on Friday.
Moving on to Japan, the market registered slight gains on Friday, building on the strength from Wall Street. The Nikkei 225 index remained above the 39,500 mark, buoyed by positive domestic economic data, including better-than-expected retail sales figures and a declining unemployment rate.
The Nikkei 225 Index concluded the morning session at 39,540.37, up 26.40 points or 0.07%, after peaking at 39,648.34 earlier. Japanese stocks had modest gains on Thursday.
Key players such as SoftBank Group edged up by 0.5%, while Fast Retailing, the owner of Uniqlo, remained flat. In the automotive sector, Toyota nudged up by 0.2%, but Honda decreased by 0.1%.
In the technology sector, Advantest increased slightly by 0.1%, Tokyo Electron soared by over 2%, whereas Screen Holdings ticked down by 0.3%.
Within banking, Sumitomo Mitsui Financial saw a slight decline of 0.1%, Mitsubishi UFJ Financial increased by 0.1%, and Mizuho Financial remained flat.
Main exporters such as Sony saw a decline of nearly 1%, Canon slipped by 0.4%, while Mitsubishi Electric and Panasonic were stable.
Among significant gainers, NEC rocketed by nearly 15%, Nomura Research Institute rose by around 7%, Chugai Pharmaceutical surged more than 6%, Fujikura gained over 5%, and Hitachi increased by more than 4%. Sumitomo Electric Industries, Furukawa Electric, and Fujitsu each advanced by almost 3%.
Conversely, Hino Motors plummeted by nearly 10%, Oriental Land lost more than 4%, and Mercari dropped over 3%, while Terumo and Sharp declined by about 3% each.In recent economic developments from Japan, retail sales rose by 3.7% year-on-year in December, as reported by the Ministry of Internal Affairs and Communications on Friday, reaching a total value of 16.123 trillion yen. This growth surpassed predictions of a 3.4% increase and was an improvement from November's 2.8% rise. However, on a seasonally adjusted monthly scale, sales saw a decline of 0.7%, following a 1.9% increase in the prior month. For the fourth quarter of 2024, retail sales slipped by 0.3% quarter-on-quarter but climbed 2.6% on an annual basis, amounting to 44.160 trillion yen. Over the entirety of 2024, retail sales grew by 2.5%, totaling 167.179 trillion yen.
In other metrics, Japan's industrial production experienced a seasonally adjusted monthly growth of 0.3% in December, as outlined in the preliminary report by the Ministry of Economy and Trade on Friday. This outcome exceeded expectations of a 0.1% reduction, following a significant 2.2% drop in November. Annually, industrial output fell by 1.1%. Despite these fluctuations, the METI (Ministry of Economy, Trade, and Industry) maintained its view that industrial production remains uncertain. Projections suggest output will increase by 1.0% in January and by 1.2% in February.
Turning to the labor market, Japan recorded a seasonally adjusted unemployment rate of 2.4% in December, as per the Ministry of Internal Affairs and Communications. This figure was slightly lower than the anticipated 2.5%, which would have mirrored November's rate. The jobs-to-applicant ratio held steady at 1.25, meeting expectations, while the participation rate fell just short of forecasts, registering at 63.4% compared to the expected 63.5%.
In the foreign exchange market, the U.S. dollar was trading in the lower 154 yen range on Friday.
Elsewhere in Asia, markets demonstrated mixed performances. Singapore and Indonesia saw gains of 1.9% and 1.0%, respectively, while New Zealand and Malaysia increased by 0.3% and 0.1%. Conversely, South Korea experienced a 1.2% decrease. Markets in China, Hong Kong, and Taiwan remained closed for the Lunar New Year festivities.
On the U.S. financial front, Wall Street experienced significant volatility on Thursday. Major indices fluctuated throughout the session before closing in positive territory. The Dow Jones Industrial Average increased by 168.61 points, or 0.4%, to close at 44,882.13, nearing its all-time high set in early December. The S&P 500 rose by 31.86 points, or 0.5%, to 6,071.17, while the Nasdaq Composite gained 49.43 points, or 0.3%, to end at 19,681.75.
In Europe, major markets also trended upward. The U.K.'s FTSE 100 Index rose by 1.0%, the French CAC 40 Index advanced by 0.9%, and Germany's DAX Index increased by 0.4%.
Crude oil prices experienced a slight uptick on Thursday, buoyed by anticipated supply decreases amid potential tariffs on Canadian and Mexican goods, along with a weaker dollar lending additional support. West Texas Intermediate crude oil futures for March delivery edged up $0.11, or 0.15%, to settle at $72.73 per barrel.
