Asian Stock Market: Traders stay divided ahead of US inflation

Asia-Pacific investors struggle for clear directions with eyes on the US headline inflation data. Also challenging the market sentiment are the mixed signals flashed by domestic catalysts during early Thursday morning in Europe.

While portraying the mood, the MSCI’s index of Asia-Pacific shares ex-Japan rises 0.40%, the same as Japan’s Nikkei 225. However, markets in China, Hong Kong and New Zealand remain on the back foot.

That said, stock futures in the US and Europe also print mild losses whereas the US 10-year Treasury yields seesaw around the highest levels since July 2019, pausing the previous day’s pullback of late.

Japan’s Producer Price Index (PPI) for January hit the highest levels since 1985 but Bank of Japan (BOJ) Governor Haruhiko Kuroda sees the limited possibility of a major inflation surge.

Elsewhere, China’s Evergrande Chairman vows full construction and no fire sales of properties but can’t convince stock bulls amid the Sino-American tussles.

Furthermore, Australia’s Consumer Inflation Expectations increased for February and Deloitte’s latest bi-annual survey of Australia’s headline Chief Financial Officers (CFOs) signaled RBA’s rate hike in 2022, which in turn challenges ASX 200 of late.

It should be noted that New Zealand’s opposition party leader Luxon mentioned that the RBNZ should concentrate entirely on inflation, which in turn dragged NZX 50.

South Korea’s KOSPI and Indonesia’s IDX Composite print mild gains while India’s BSE Sensex rise the most among the region as the Reserve Bank of India (RBI) kept benchmark rates unchanged during today’s monetary policy meeting.

Moving on, market players will keep their eyes on the US Consumer Price Index (CPI) for January, expected 7.3% YoY versus 7.3% prior, for fresh impulse.

Read: US Treasury yields dwindle, S&P 500 Futures ignore Wall Street gains amid inflation anxiety