Asian markets rose on Thursday following a surge in U.S. stocks as investors grew more optimistic about inflation trends. Reports showed that American consumers faced a 3.4% increase in prices for various goods in April compared to the previous year, a slight improvement from March’s 3.5% inflation rate. This news eased concerns about rising consumer prices and bolstered expectations that the Federal Reserve might lower interest rates.
In Asian trading, Japan’s Nikkei 225 index climbed 0.8%, while Hong Kong’s Hang Seng index and China’s Shanghai Composite index also saw gains. Australian and South Korean markets also advanced, with Taiwan and India following suit.
On Wednesday, the S&P 500, Dow Jones Industrial Average, and Nasdaq all reached record highs, propelled by stocks that benefit from lower interest rates. Homebuilders and tech companies saw significant gains, with real estate and utility stocks also performing well.
However, not all stocks fared positively, as GameStop and AMC Entertainment experienced losses after earlier gains. Meanwhile, a report indicating stagnant retail sales in the U.S. raised concerns about consumer spending, a key driver of economic growth.
Bond yields eased, reflecting expectations of Fed rate cuts, with traders predicting a high probability of at least one rate cut this year. Oil prices also saw modest increases, with U.S. benchmark crude rising to $79.05 per barrel and Brent crude reaching $83.14 per barrel.
The U.S. dollar weakened against the Japanese yen but strengthened against the euro. Overall, market sentiment remained positive amid hopes for lower interest rates and stable inflation levels.