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South Korea’s central bank raised its key interest rate by a quarter-percentage point as expected on Thursday, in a bid to contain inflation and prevent capital outflows as the U.S. Federal Reserve gears up for more hikes.
Jung Yeon-je | Afp | Getty Images
Japan’s Nikkei 225 hit another record Thursday fueled by “Takaichi trade,” while the broader Asia-Pacific markets mostly climbed after tech stocks powered a Wall Street rally overnight.
The Nikkei 225 rose 1.1%, to an all-time high of 59,199.31, extending its winning streak of record highs to a third straight session. The broader Topix added 1.45%, also scaling a new peak.
On Wednesday, the Japanese government tapped Ayano Sato of Aoyama Gakuin University and Toichiro Asada of Chuo University as central bank board members, both dovish in their policy stance which aligns with Prime Minister Sanae Takaichi’s approach as well.
The two will succeed outgoing central bank board members Asahi Noguchi and Junko Nakagawa, whose terms expire at the end of March and in June, respectively.
Japanese equities have scaled multiple record highs recently, buoyed by the so-called “Takaichi trade,” as investors bet that the prime minister’s growth-oriented policies — viewed as an extension of Abenomics — will lift stocks while pressuring the yen through looser monetary policy and increased fiscal spending.
South Korea’s Kospi rose 1.65%, while the small-cap Kosdaq advanced 0.57%.
Australia’s S&P/ASX 200 gained 0.8%, also hitting a record high in early trade.
Hong Kong Hang Seng index fell 0.62%, while the CSI 300 lost 0.2%.
The Bank of Korea left its base rate unchanged at 2.5%, in line with Reuters’ expectations.
Asian tech stocks rallied as stronger-than-expected results from Nvidia eased concerns that momentum in artificial intelligence sector was cooling.
Shares of South Korean chipmaking giants Samsung Electronics and SK Hynix jumped in early trade.
SK Hynix, which is a key supplier of high-bandwidth memory used in AI applications to Nvidia, rose over 2%. Samsung Electronics, which has been a decades-old partner of Nvidia, was up about 5%.
Other South Korean tech stocks also rose, with components manufacturer LG Innotek surging almost 14%, while Seoul Semiconductor soared 13%.
In Japan, the TOPIX Information & Communication index climbed 2.6%, building on previous day’s 0.58% gain.
Overnight in the U.S., equities rose, supported by Nvidia and Oracle, as stocks built on the gains from the prior trading day.
The S&P 500 added 0.81% to close at 6,946.13, and the Nasdaq Composite advanced 1.26% to 23,152.08. The Dow Jones Industrial Average rose 307.65 points, or 0.63%, to settle at 49,482.15.
Nvidia posted fiscal fourth-quarter results that topped Wall Street expectations, fueled by a 75% surge in revenue from its core data center segment. Shares gained as much as 2% in extended trading following the release.
The company reported adjusted earnings per share of $1.62, beating the $1.53 forecast from analysts surveyed by LSEG. Revenue totaled $68.13 billion, above estimates of $66.21 billion.
—CNBC’s Sean Conlon and Pia Singh contributed to this report.
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