Japan’s Nikkei climbed 0.8 percent to a record high, led by gains in technology, energy and utility stocks
Asian stock markets rallied on Thursday as Japanese and Taiwanese stocks hit record highs, boosted by gains in technology shares. Investors bet that U.S. inflation data will remain moderate, supporting an interest rate cut next week and possibly two more by the end of the year.
Meanwhile, the European Central Bank is widely expected to keep interest rates unchanged later in the day. However, ongoing trade tensions and political uncertainties suggest the bank may continue to leave the door open for future easing.
AI chip stocks surge
In the Asian stock market, Japan’s Nikkei climbed 0.8 percent to a record high, led by gains in technology, energy and utility stocks. Taiwanese shares also hit a record, rising 1 percent, with leading chipmaker TSMC up 2.5 percent.
SoftBank surged nearly 9 percent after its Stargate Project partner, Oracle, jumped 36 percent on Wall Street, the biggest one-day percentage gain since 1992, on forecasts of strong demand from AI companies for its cloud computing services. Its market capitalization surged to $922 billion, surpassing Eli Lilly, JPMorgan Chase, and Walmart, and drawing closer to Tesla’s $1.12 trillion valuation.
Artificial intelligence-focused chip stocks surged, with Nvidia up 3.85 percent to $177.33, Broadcom jumping 9.77 percent to $369.57, and Advanced Micro Devices rising 2.37 percent to $159.54. The PHLX chip index also climbed 2.38 percent to 5,958.09.
Nasdaq, S&P 500 futures gain following record close
In the U.S. stock market, Nasdaq futures climbed 0.2 percent, while S&P 500 futures edged up 0.1 percent. On Wednesday, the S&P 500 and Nasdaq hit record-high closes as Oracle surged and cooler-than-expected inflation data supported expectations that the U.S. Federal Reserve will cut interest rates next week.
In Asia-Pacific, MSCI’s broadest index of shares outside Japan slipped 0.1 percent, weighed down in part by a 0.9 percent decline in Hong Kong’s Hang Seng index.
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Fed to cut rates three times this year
Overnight, softer-than-expected U.S. producer price data boosted market expectations for as many as three Federal Reserve rate cuts this year. Investors have fully priced in a 25-basis-point reduction at next week’s meeting, with an 8 percent chance of a larger 50-basis-point cut.
With PPI data behind them, attention now turns to August’s Consumer Price Index, due later in the day. Analysts expect the headline CPI to rise 2.9 percent year-on-year, the largest increase since January, while the core measure is expected to remain at 3.1 percent.
In the commodities markets, oil prices declined. Brent crude futures fell 7 cents, or 0.10 percent, to $67.42 a barrel, while U.S. West Texas Intermediate (WTI) crude futures dipped 9 cents, or 0.14 percent, to $63.58. The benchmarks had advanced by more than $1 each on Wednesday, following Israel’s strike on Hamas leadership in Qatar a day earlier, and as Poland activated its own and NATO air defenses to intercept suspected Russian drones that entered its airspace during an assault on western Ukraine.
Meanwhile, spot gold fell 0.30 percent to $3,631.82, as of 4:46 GMT, after hitting a record high of $3,673.95 on Tuesday. Meanwhile, U.S. gold futures for December delivery dipped 0.31 percent to $3,670.50.
AloJapan.com