Most Asian stocks experienced gains on Friday, contributing to a positive week for the region. The technology sector saw stellar performance driven by optimism over artificial intelligence (AI), while Chinese stocks extended their rebound into a second week. However, concerns about higher U.S. interest rates persisted, particularly following strong labor market data and hawkish signals from the Federal Reserve during the week.
The Nikkei 225 in Japan, despite being closed for a market holiday, had a notable performance earlier in the week, rising by 1.6%. Regional trading volumes remained somewhat muted due to the holiday in Japan.
Positive cues from Wall Street’s record-high close on Thursday, fueled by outstanding earnings and guidance from AI-focused company NVIDIA Corporation (NVDA), boosted confidence in the technology sector. Investors hope that the demand for AI will drive increased investment in the tech industry throughout the year.
Asian tech giants experienced gains influenced by NVIDIA’s strong performance. South Korea’s KOSPI rose by 0.5%, with memory chip maker SK Hynix Inc registering a 3.7% increase, reaching a record high. Taiwan’s TSMC and Hon Hai Precision Industry Co Ltd, both key suppliers to NVIDIA, showed mixed movements in Taiwan trade but posted overall positive weekly performances.
Australia’s ASX 200 also rose by 0.5%, primarily driven by strength in tech stocks. Futures for India’s Nifty 50 index indicated a positive opening, with the Nifty having risen by 0.7% on Thursday, supported by strong performances in heavyweight technology stocks.
Chinese stocks exhibited a flat-to-low range on Friday but were on track for a second consecutive week of gains. The Shanghai Shenzhen CSI 300 and Shanghai Composite indexes showed minimal movements, while Hong Kong’s Hang Seng index experienced a 0.2% decline on the day. Despite Friday’s fluctuations, the Hang Seng was up by 2.2% for the week, supported by strength in heavyweight tech and mainland stocks. The CSI300 and Shanghai Composite also recorded gains between 3.4% and 4% for the week, marking their second straight week of recovery after hitting five-year lows in February.
Investor sentiment towards China was positively influenced by signs of improved consumer spending during the Lunar New Year holiday. Additionally, the government implemented various supportive measures, including interest rate cuts and restrictions on block share sales.