Asian stocks sluggish as markets await crucial US jobs report; China’s CPI reaches highest level in 3 years

Most Asian stock markets saw modest gains on Friday, following a mixed close on Wall Street as investors remained cautious ahead of crucial U.S. jobs data that could influence expectations for future Federal Reserve interest rate cuts.

U.S. markets closed Thursday with mixed results: technology stocks pulled back after recent advances, putting pressure on the Nasdaq, while the Dow and S&P 500 showed little movement.

Futures for major Wall Street indexes remained mostly flat during Friday’s Asian trading session.

Asian stocks mostly flat as Nikkei posts gains

Asian markets showed limited movement, reflecting investor caution, with the technology sector leading declines.

South Korea’s KOSPI index remained mostly flat after reaching record highs earlier in the week, as chipmakers Samsung Electronics (KS:005930) and SK Hynix (KS:000660) dropped between 1.5% and 3%.

Australia’s S&P/ASX 200 gained 0.3%, while Singapore’s Straits Times Index held steady.

Futures for India’s Nifty 50 also remained largely unchanged.

In contrast, Japanese stocks outperformed the region, with the Nikkei 225 rising 1% and the broader TOPIX index increasing 0.3%. A weaker yen against the U.S. dollar supported exporters’ prospects.

Looking ahead, investor attention is focused on the U.S. nonfarm payrolls report expected later on Friday, which could offer crucial insights into the health of the world’s largest economy and influence the Federal Reserve’s monetary policy outlook.

China’s December CPI reaches highest level in 3 years, PPI deflation slows

In China, official data released on Friday showed consumer inflation rose to its highest level in nearly three years, offering tentative signs of improving demand.

The consumer price index increased 0.8% year on year in December, the fastest pace in about 34 months, while monthly prices rose 0.2%. At the same time, producer price deflation eased, indicating some stabilization in factory-gate prices.

The data indicated that China could be nearing an end to a prolonged deflationary period that has dampened economic growth, squeezed corporate earnings, and restrained consumer spending.

China’s blue-chip Shanghai Shenzhen CSI 300 index gained 0.3%, while the Shanghai Composite rose 0.6%. Hong Kong’s Hang Seng traded flat.

Sources: Investing