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Asian stocks buoyed by tech as nonfarm payrolls approach

Published 05/02/2024, 10:53 PM
© Reuters.

Investing.com-- Most Asian stocks rose on Friday, supported by technology shares as positive earnings from Apple Inc supported sentiment, although regional market holidays and anticipation of key U.S. data kept gains in check.

Regional trading volumes were somewhat dulled by holidays in Japan and China. 

Asian markets took a positive lead-in from Wall Street, which rose on Thursday as tech stocks rebounded from steep losses this week. U.S. stock index futures also rose in Asian trade.

But overall gains were limited, while Wall Street was still headed for weekly losses as fears of high-for-longer U.S. interest rates largely quashed any optimism. Focus was now on upcoming nonfarm payrolls data, due later in the day, for more cues on rates. 

Asian tech tracks US gains, better-than-feared Apple earnings

Tech-heavy Asian bourses were among the better performers for the day, with Hong Kong’s Hang Seng index up 1.4%. The index was also the best performer in Asia this week, as more stimulus measures in China, particularly in the real estate sector, greatly boosted property stocks.

South Korea’s KOSPI added 0.1%, while gains in tech pushed Australia’s ASX 200 up 0.6%. 

An after-hours bounce in Apple Inc (NASDAQ:AAPL) spilled over into the firm’s Asian suppliers, especially after the iPhone maker clocked better-than-feared earnings and forecast some revenue growth in the current quarter. 

Apple suppliers in Taiwan- chiefly TSMC (TW:2330) (NYSE:TSM) and Hon Hai Precision Industry (Foxconn (TW:2317)- rose 1.5% and 2.3%, respectively. 

Hong Kong’s AAC Technologies (OTC:AACAY) Holdings Inc (HK:2018) added over 3%, while in South Korea, Samsung Electronics Co Ltd (KS:005930), SK Hynix Inc (KS:000660) and LG Innotek Co Ltd (KS:011070) rose between 0.5% and 5.2%. 

Broader Asian markets were largely muted, as trading volumes remained limited amid regional holidays and caution over U.S. interest rates. 

Futures for India’s Nifty 50 index pointed to a muted open, after the index briefly hit record highs earlier this week. But the Nifty otherwise clocked mild intraday moves amid caution over India’s 2024 general elections. 

Nonfarm payrolls awaited for more rate cues 

Markets were also largely cautious before key nonfarm payrolls data due later on Friday. 

Nonfarm payrolls have consistently smashed market expectations for the past five months, amid continued strength in the U.S. labor market.

Labor market strength gives the Federal Reserve more headroom to keep interest rates high for longer. The central bank had warned as much during a meeting earlier this week, although it also said that future rate hikes were unlikely, despite recent stickiness in inflation.

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