Asia stocks extend rally tracking Wall St record highs; tech sector leads gains

Investing.com-- Asian stock markets extended their rally on Friday, with technology and chipmaker shares leading gains, as investors tracked record highs on Wall Street amid expectations of a Federal Reserve rate cut next week.

Hong Kong and South Korea were the top performers, while Japan’s Nikkei 225 reached a fresh record high despite political unrest in the country.

All three benchmark U.S. stock indexes closed at record highs on Thursday, driven by strong tech sector performance amid renewed AI optimism. 

Investors reacted positively to a mixed set of U.S. economic data, which fueled speculation that the Federal Reserve would reduce interest rates at its upcoming meeting. 

As of 02:41 GMT, U.S. stock index futures traded largely unchanged.

Asia tech stocks rally tracking US peers

South Korea’s KOSPI index jumped 1.3%, buoyed by SK Hynix Inc (KS:000660), which surged nearly 6% to a record high after announcing the completion of its next-generation high-bandwidth memory, HBM4, and preparations for mass production. 

The memory chip, aimed at artificial intelligence applications, offers double the bandwidth and more than 40% improved power efficiency compared with its predecessor.

Hong Kong’s Hang Seng index advanced 1.5%, with Hang Seng TECH sub-index surging nearly 2.5%.

Japan’s Nikkei 225 climbed 0.8% to 44,888 points, a fresh record peak, despite political uncertainty following Prime Minister Shigeru Ishiba’s resignation.

Japan’s broader TOPIX index gained 0.5%, also hitting fresh record highs of 3,171.7 points.

Fed rate cut bets remain firm after US CPI. 

Data on Thursday showed that the U.S. consumer price index rose 0.4% month-on-month in August, slightly above expectations, while weekly jobless claims jumped to 263,000, pointing to a softening labor market.

The mixed signals did little to alter expectations that the Fed will cut interest rates at its Sept. 16-17 meeting.

Traders in futures markets are pricing in a near-certainty of a 25-basis-point reduction, with slim odds of a larger half-point move.

Back in Asia, mainland China’s Shanghai Composite edged 0.2% lower, while the Shanghai Shenzhen CSI 300 fell 0.4%. Both indices saw sharp gains in the previous session.

Australia’s S&P/ASX 200 rose 0.7%, while Singapore’s Straits Times Index edged down 0.2%.

Futures for India’s Nifty 50 were largely unchanged.