Asian stocks rise ahead of key U.S. inflation data: Market Roundup

(Bloomberg) - Stocks in Asia rose following a rally in Wall Street, as the focus shifted to key U.S. consumer-price data to be released later Friday.

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Benchmarks in Japan, Korea and China showed modest gains after U.S. stocks ended the first quarter on a positive note. Investors are waiting for the release of the Fed's preferred consumer price index to find new clues about its policy outlook.

Several Asian markets, including Australia, Hong Kong and Singapore, were closed Friday for a public holiday.

The region's gains come after traders sent the S&P 500 to its 22nd record so far this year amid data showing the U.S. economy remains healthy. The $4 trillion surge in the value of U.S. equities in just three months has surprised doomsayers and sent many strategists scrambling to update their 2024 targets.

"Domestic events drove up stocks in China, Japan and Korea, and the overnight rally in the U.S. also bolstered investor sentiment," said Seo Sang-Young, market strategist at Mirae Asset Securities. The end-of-quarter rebalancing of investment portfolios also seems to be working," said Seo Sang-Young, market strategist at Mirae Asset Securities.

Traders are wary of possible volatility in the yen's exchange rate after Japanese officials stepped up warnings this week to halt its slide. Masato Kanda, deputy finance minister for international affairs, said in an interview on Friday that the yen's weakness was inconsistent with the fundamentals of the economy. He also reiterated his commitment to take action if necessary to prevent excessive exchange rate fluctuations.

Taishi Fujita, manager of global markets for the Americas at Japan's MUFG Bank, says people are becoming more wary of intervention. Even if you have established a position to sell the yen during a strong period, you are likely to abandon the position near 152." He noted that the market is likely to continue to hover at a low of 151 yen to the dollar.

Consumer price growth in Tokyo has slowed, but remains well above the central bank's inflation target, the latest data showed. That could keep the central bank considering more rate hikes after it raised rates earlier this month for the first time since 2007.

On the Chinese corporate front, one of the country's biggest real estate companies has delayed releasing its financial results, while another announced a historic drop in profit. Beyguiyuan Holdings Co. announced late Thursday that it would miss a deadline for releasing its annual results, saying it needed more information. Developer China Vanke Co. said its net profit fell 46% last year.

unhurried

Swap traders on Thursday slightly lowered their bets that the Fed will cut interest rates as soon as June, following Fed Governor Christopher Waller's statement on Wednesday that there was no rush to cut rates. Two-year Treasury yields climbed 5 basis points to 4.62% in brief pre-holiday trading, while the dollar continued its quarterly uptrend. Asian spot bond trading was closed for the holiday.

The U.S. government's two main measures of economic activity - gross domestic product and consumer spending - ended last year with strong gains. Consumer sentiment rose markedly at the end of March, supported in part by a strong rise in the stock market.

In addition to the release of the PCE Price Index, the Fed's preferred inflation gauge, traders will be watching closely for Fed matron Jerome Powell's speech later on Friday.

Elsewhere, gold hit an all-time high, extending a weeks-long rally that was fueled by bets on a Fed rate cut and deepening geopolitical tensions. Oil posted a quarterly gain of 16%, the latest sign that export restrictions by the E.U.P. and its allies are curbing global supply.

The Bitcoin fell on Friday after climbing to $71,555 in the previous session. Meanwhile, FTX co-founder Sam Bankman-Fried was sentenced to 25 years in prison for stealing billions of dollars from clients.

Important events this week

• Good Friday. Exchanges in the United States and many other countries are closed for the holiday. U.S. Federal Government Offices
• U.S. Personal Income and Expenditures, PCE Deflator Friday
• On Friday, San Francisco Fed matron Mary Daly spoke.
• Fed chief Jerome Powell to speak on Friday

Main Market Movements

stock (market)

• Japan's Topix index closed up 0.7 percent.
• Shanghai Composite Heel Index rises 1
• The S&P 500 Index rose 0.1 percent.
• Nasdaq Resonance 100 Index down 0.1%

Currency

• Bloomberg Dollar Spot Index rises 0.1%
• Euro down 0.1% at $1.0776
• The yen was little changed at 151.41 yen per US dollar.
• The offshore RMB exchange rate was little changed at US$7.2554 per US dollar.

Encryption Currency

• Bitcoin down 0.4% at $70,444.16
• Ether up 0.3% to $3,572.85

This story was produced with the help of Bloomberg Automation.

-Written with the help of Youkyung Lee and Daisuke Sakai.

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