Asian Markets Surge on Hong Kong, Japan Inflation Surprise

Asian markets rallied on Hong Kong gains, and Japan beat inflation forecasts; investors await key US and Indian inflation data.

Most Asia-Pacific markets experienced gains on Tuesday, buoyed by a surge in Hong Kong’s Hang Seng index and positive Japanese inflation data. Investors awaited key inflation figures from India and the United States.

The Hang Seng index soared over 2%, extending its winning streak to three days, while the mainland Chinese CSI 300 saw a more modest increase of 0.37%. In Japan, the corporate inflation rate for February came in at 0.6%, exceeding economists’ expectations of 0.5% and marking a significant climb from January’s figure of 0.2%.

Asian Markets Surge on Hong Kong, Japan Inflation Surprise

The positive inflation reading in Japan has raised speculation that the Bank of Japan might consider raising rates sooner than expected, potentially influencing equity markets in the region. Despite this, Japan’s Nikkei 225 slipped for a second consecutive day, declining by 0.05%, and the broader Topix was down 0.67%.

On the other hand, Australia’s S&P/ASX 200 rebounded, closing at 7,712.5 with a gain of 0.11%, while South Korea’s Kospi showed positive movement, trading up 0.52%. The small-cap Kosdaq climbed 1.25%.

Investors are closely monitoring inflation figures from India and the US, scheduled for release later on Tuesday, to gain insights into the potential timing of the Federal Reserve’s interest rate adjustments.

Overnight, the three major U.S. indexes displayed mixed results. The ongoing cooling of the tech rally contributed to the S&P 500 and Nasdaq Composite experiencing a second consecutive negative session, falling by 0.11% and 0.41%, respectively. However, the Dow Jones Industrial Average defied the trend, adding 0.12%.

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