Asia stocks climb tracking Wall St rally; Japan near record highs after PM exit

Updates at 05:10 GMT with latest price moves, India shares, and additional context

Investing.com-- Asian stocks climbed on Wednesday, led by South Korea and Hong Kong tracking Wall Street’s record close, while Japanese shares hovered near historic highs amid political unrest following Prime Minister Shigeru Ishiba’s resignation.

Investors also assessed weaker-than-expected inflation data from China, highlighting persistent deflationary pressures on the world’s second-largest economy.

All three major Wall Street indices hit record closing highs on Tuesday, buoyed by expectations of a Federal Reserve rate cut next week. 

U.S. stock index futures were little changed in Asia hours on Wednesday.

Japan stocks near record high amid political uncertainty

Japan’s Nikkei 225 index rose 0.8% 4,3793.0 points on Wednesday, hovering just below record highs reached in the previous session. It rose to as high as 44,185.7 points on Tuesday.

The broader TOPIX index gained 0.6% on Wednesday.

The move came after Japanese Prime Minister Shigeru Ishiba stepped down on Sunday following heavy election losses and growing internal party dissent.

This sparked expectations that his successor may pursue more expansionary fiscal and monetary policies.

Market sentiment was also supported by confirmation of a U.S.-Japan deal lowering tariffs on Japanese auto exports by mid-September.

S. Korea, HK lead gains; China CPI in focus

Hong Kong’s Hang Seng rose 1.2% to a four-year high on Wednesday, with the Hang Seng TECH sun-index jumping as much as 2% on optimism around tech-heavy Nasdaq hitting a fresh record high close.

South Korea’s KOSPI surged 1.7%, with heavyweight chipmakers Samsung Electronics (KS:005930) and SK Hynix (KS:000660) rising 3.6% and 5.5% respectively.

Singapore’s Straits Times Index also climbed over 1%.

Meanwhile, data on Wednesday showed that China’s consumer prices fell more than expected in August, as government stimulus failed to counter entrenched deflation, while producer prices extended their decline for a 35th straight month.

The Shanghai Composite inched up 0.3%, while the Shanghai Shenzhen CSI 300 gained 0.4%, after reversing earlier losses.

Elsewhere, Australia’s S&P/ASX 200 edged 0.3% higher.

India’s Nifty 50 gained 0.5% in early trade. U.S. President Donald Trump said on Tuesday that trade negotiations with India were ongoing, and that he would speak with Prime Minister Narendra Modi in the coming weeks.