Asia stocks cautiously advance ahead of Powell speech; Japan mixed on sticky CPI

Updates at 00:15 ET (04:15 GMT) with India open, HK earnings 

Investing.com-- Most Asian stocks rose on Friday, although gains were muted as investors hunkered down in anticipation of more cues on U.S. interest rates from an upcoming address by Federal Reserve Chair Jerome Powell.

Japanese shares were a mixed bag as consumer inflation data for July showed price growth remaining well above the Bank of Japan’s annual target, a trend that could push the bank into raising interest rates further. 

Regional markets took middling cues from a negative session on Wall Street, as technology shares continued to decline, while mixed earnings from Walmart (NYSE:WMT) also weighed.

S&P 500 Futures were mildly higher in Asian trade, with focus chiefly on Powell’s address at the Jackson Hole Symposium later in the day. His speech comes amid growing doubts over whether the Fed will cut interest rates in September, especially after the minutes of the central bank’s July meeting struck a hawkish note.

Japan’s Nikkei flat; CPI reads sticky for July 

Japan’s Nikkei 225 index moved in a tight range, while the broader TOPIX index added 0.4%. 

Japanese consumer price index inflation cooled in July, data showed on Friday. But core inflation cooled slightly less than expected, while underlying inflation also remained well above the BOJ’s 2% annual target.

Sticky inflation puts more pressure on the BOJ to hike interest rates, with analysts seen penciling in at least one rate hike by end-2025. Such a scenario bodes poorly for Japanese shares.

The Nikkei was trading down 1.7% this week, while the TOPIX was set to lose 0.2%. Both indexes were hit by profit-taking after reaching record highs last week. 

Asia stocks rise, China leads weekly gains amid tech selling

Broader Asian stocks advanced on Friday, with most regions set for middling weekly performances after sharp losses earlier this week.

Chinese markets, however, outpaced their peers on expectations of more stimulus from Beijing. Non-tech sectors, which represent a greater portion of mainland markets, also benefited from buying as investors pivoted out of tech en masse. 

The Shanghai Shenzhen CSI 300 and Shanghai Composite indexes rose 0.7% and 0.3%, respectively, on Friday, and were trading up between 2% and 3% this week.

The CSI300 was at a 10-month high, while the SSEC scaled a nine-year peak.

Hong Kong’s Hang Seng index rose 0.4% but was trading down mildly for the week, amid weakness in tech shares and a mixed crop of second-quarter earnings. 

A host of major HK earnings are due next week, including prints from Ping An Insurance (HK:2318), Meituan (HK:3690), China Life Insurance Co Ltd (HK:2628), PetroChina Co Ltd (HK:0857), and Alibaba (NYSE:BABA) Group (HK:9988). 

The e-commerce giant will be closely watched for more insight into Chinese consumer spending, while its AI development will also be in focus. 

Outside Hong Kong, investors will also be watching for earnings from Nvidia (NASDAQ:NVDA) Group, which are likely to act as a bellwether for the battered tech sector. 

Australia’s ASX 200 fell 0.2%, but was set for mild weekly gains after racing past the 9,000 point level for the first time ever.

South Korea’s KOSPI rose 0.9%, extending a rebound from recent losses. But the index was set to lose nearly 2% this week on an extended rout in tech shares.

India’s Nifty 50 index fell 0.5% on Friday, but was trading up 1.5% this week. Strong Indian PMI data and promises of reform from the government helped investors look past concerns over higher U.S. trade tariffs against India over its purchases of Russian oil.

Singapore’s Straits Times index rose 0.2% and was trading up 0.3% this week.