© Reuters.
biedexmarkets.com– Most Asian stocks rose sharply on Friday as China rolled out more measures to support economic growth, while markets bet that the Federal Reserve will hold interest rates next week despite strong readings on inflation.
Regional markets took a , as strong and data pointed to continued resilience in the world’s largest economy. Technology stocks in particular saw a stellar rally, as sentiment towards the sector was boosted by a heavily oversubscribed initial public offering by chip designer Arm Holdings (NASDAQ:).
Arm’s parent, Japanese tech conglomerate SoftBank Group Corp. (TYO:), rose over 2% in Tokyo trade, helping the index rise 1.1%. The index hit a 2-½ month high, and was within sight of a 33-year peak.
Futures for India’s index pointed to another positive open after the index hit a series of record highs this week. Improving sentiment towards the Indian economy and heavy technology exposure have been the key drivers of the Nifty’s rally this year.
China stimulus boosts sentiment, but economic data mixed
Broader Asian markets rose as the People’s Bank of China (PBOC) cut its reserve ratio requirements for local lenders by 25 basis points- its second such move this year. The cut is expected to unlock more liquidity in the Chinese economy, potentially shoring up growth.
Australia’s – which is heavily exposed to China- jumped 1.8%.
But Chinese markets lagged their peers, with the and indexes logging meager gains.
Data released on Friday showed Chinese and grew more than expected in August. But declined, while new home sales also slumped, indicating that large portions of Asia’s largest economy still remained under pressure.
Chinese stocks were nursing steep losses for the year, amid growing concerns over whether a post-COVID economic recovery in the country will pan out as forecast.
Tech stocks rally on Arm optimism, Fed seen holding rates
Tech-heavy bourses were the best performers in Asia on Friday, with South Korea’s up 1.3%, while Hong Kong’s index added 1.4%.
In addition to optimism over the Arm IPO, sentiment towards tech was largely boosted by bets that the Federal Reserve when it meets next week.
While data this week showed U.S. consumer and inflation grew more than expected in August, analysts said the rise was still not sufficient to elicit a rate hike by the Fed next week.
But the central bank is still expected to keep interest , a trend that may limit any major gains in global tech stocks.
