Asia Stocks Edge Higher; Australia Leads on Strong Earnings
Most Asian stock markets posted modest gains on Wednesday, with Australian equities outperforming after a strong round of corporate earnings. Investors also evaluated softer-than-expected Chinese inflation data, which highlighted ongoing economic challenges.
However, gains across the region were limited as traders adopted a cautious stance ahead of closely watched U.S. nonfarm payrolls data later in the day. The employment report could significantly influence expectations for future Federal Reserve interest rate decisions.
U.S. stock futures ticked higher during Asian trading hours, following a weaker session on Wall Street where major indexes pulled back as investors took profits after recent advances.
Australian Shares Hit 15-Week High on Earnings Rally
Australia’s S&P/ASX 200 index surged 1.5%, reaching its highest level since late October. The rally was driven by upbeat earnings from heavyweight companies.
Shares of Commonwealth Bank Of Australia jumped more than 8% after the country’s largest lender reported stronger-than-expected half-year profits. Solid net interest margins and stable credit quality supported investor confidence.
Energy stocks also contributed to gains. AGL Energy rose sharply after posting robust results and reaffirming its earnings outlook.
Meanwhile, James Hardie Industries climbed over 13% following solid quarterly earnings that reflected continued demand in key overseas markets.
On the downside, CSL Ltd shares fell more than 12% after disappointing half-year earnings and news of a leadership change, partially capping broader market gains.
Regional Markets Mixed; Japan Closed
Elsewhere in Asia, Japanese markets were closed for a public holiday. The Nikkei 225 had reached a record high on Tuesday amid optimism following Prime Minister Sanae Takaichi’s election victory.
South Korea’s KOSPI rose nearly 1%, while Singapore’s Straits Times Index gained 0.2%. Futures for India’s Nifty 50 edged 0.1% higher.
China CPI Misses Expectations; PPI Stays Negative
China’s consumer price index (CPI) increased at a slower pace than forecast in January, while producer price index (PPI) data remained in contraction territory. The figures underscored persistent deflationary pressures and weak domestic demand in the world’s second-largest economy.
The data reinforced concerns that subdued price growth could continue to weigh on corporate earnings, despite policy efforts aimed at supporting economic activity.
China’s Shanghai Shenzhen CSI 300 and Shanghai Composite traded largely flat. Meanwhile, Hong Kong’s Hang Seng Index advanced 0.3%.
Overall, Asian markets remain sensitive to both corporate earnings developments and global macroeconomic data, particularly signals that could shift the Federal Reserve’s policy outlook.
