Most Asian equity markets posted modest gains on Wednesday, driven largely by a strong performance in Australia where corporate earnings lifted sentiment. Markets elsewhere were more restrained as traders focused on weaker-than-anticipated Chinese inflation data and awaited key U.S. jobs figures later in the day that could affect expectations for Federal Reserve policy.
Futures tied to U.S. equities nudged higher in Asian trading after Wall Street closed lower overnight, with major indexes retreating as some investors took profits after a recent advance.
Australia out in front
Australia’s S&P/ASX 200 led regional markets, climbing 1.5% to reach its highest level since late October. The index’s outperformance was largely attributable to strong earnings from several large companies.
- Shares of Commonwealth Bank Of Australia (ASX:CBA) rose by more than 8% after the lender reported a half-year profit that beat expectations, helped by resilient margins and steady credit quality.
- Energy names contributed to the advance, with AGL Energy (ASX:AGL) jumping sharply after posting solid earnings and reiterating its outlook.
- Building materials firm James Hardie Industries (ASX:JHX) climbed more than 13% following quarterly results that highlighted sustained demand in important overseas markets.
- Offsetting some of the rally, CSL Ltd (ASX:CSL) dropped over 12% after releasing weak half-year earnings and announcing a change in chief executive.
Regional market moves
Japanese markets were closed for a public holiday. On Tuesday the Nikkei 225 reached a record high amid optimism tied to Prime Minister Sanae Takaichi’s election victory. South Korea’s KOSPI rose nearly 1%, while Singapore’s Straits Times Index added 0.2%. Futures for India’s Nifty 50 inched up about 0.1%.
China price readings underscore demand concerns
Chinese consumer inflation decelerated in January, growing at a slower pace than economists had expected, while producer prices remained in deflation. Those readings highlighted lingering weakness in domestic demand and reinforced worries that softer prices could continue to pressure corporate earnings, even after recent policy steps intended to support growth.
China’s blue-chip Shanghai Shenzhen CSI 300 index and the Shanghai Composite traded largely flat on the data. In Hong Kong, the Hang Seng index gained roughly 0.3%.
Looking ahead
Market participants remained cautious as they awaited U.S. labor market data due later in the day. That release has the potential to reshape rate expectations and thereby influence global equity sentiment.