On Thursday, many Asian stocks bounced back from recent declines, brushing off a tepid performance on Wall Street. Investors seemed optimistic about an anticipated strong earnings report from leading chipmaker TSMC, which fueled hopes for a tech sector rally. Bargain hunters also stepped in after concerns over prolonged U.S. interest rate hikes and escalating tensions in the Middle East had triggered a week-long sell-off in regional markets.
While Asian markets managed to climb despite a lackluster showing from Wall Street, chip stocks took a hit following disappointing earnings from ASML Holding NV. Nevertheless, U.S. futures saw modest gains during Asian trading hours.
However, lingering worries about sustained U.S. interest rate increases, particularly after hawkish signals from the Federal Reserve, tempered broader market gains across Asia.
In China, the Shanghai Shenzhen CSI 300 and Shanghai Composite indexes inched up by 0.1% each, building on recent upward momentum driven by robust first-quarter growth figures. Hong Kong's Hang Seng also rebounded by 0.8% from its recent lows, buoyed by expectations of further stimulus measures from Beijing. Nonetheless, concerns over near-term growth persisted, dampening the pace of gains in Chinese markets, especially as March data hinted at a slowdown following a strong start to the year.
Investors awaited TSMC's first-quarter earnings report, with the chipmaker expected to benefit from increased demand in the artificial intelligence sector. However, ASML's weaker-than-expected earnings raised concerns about a potential slowdown in AI demand, putting some investors on edge.
Despite some recovery in Asian stocks, worries about prolonged U.S. interest rate hikes continued to weigh on broader market sentiment, with many regional benchmarks still grappling with steep losses in April.
In individual markets, Australia’s ASX 200 edged up by 0.6%, supported by cooling labor market data, although labor conditions remained tight, allowing the Reserve Bank of Australia room to maintain higher rates. Japan’s Nikkei 225 and TOPIX saw modest gains of 0.2% and 0.5%, respectively. South Korea’s KOSPI outperformed, surging 1.8% as it bounced back from over two-month lows. However, India's Nifty 50 index was poised for a weak start, likely to incur some losses in catch-up trade following a holiday on Wednesday.
Paraphrasing text from "Investing" all rights reserved by the original author.
