Asia-Pacific Markets Rise as U.S. Inflation Data Takes Center Stage

Shares in the Asia-Pacific region were mostly higher on Thursday as investors looked ahead to the release of the U.S. consumer price index report. Economists expect inflation to have cooled in December, which could signal to the Federal Reserve that previous interest rates hikes have had their intended effects.
‍

Australia's S&P/ASX 200 closed 1.18% up at 7,280.4 after the release of the country's November trade balance. The trade balance showed a surplus of A$6.8 billion, beating expectations of a A$4.5 billion surplus. This was driven by strong exports of iron ore and coal.
‍‍

The Nikkei 225 closed at 26,449.82, while the Topix climbed 0.36% to 1,908.18. South Korea's Kospi edged up 0.24% to 2,365.1, while the Kosdaq dipped 0.15% to 710.82.
Hong Kong's Hang Seng index declined slightly, reversing earlier gains. Mainland China's Shanghai Composite added 0.051% to close at 3,163.45, while the Shenzhen Component was up 0.23% to 11,465.73. China's consumer price index rose 1.8% in December from the previous year, in line with Reuters' expectations.
‍

India is set to release its inflation data for December. This will give economists and policymakers a better idea of the country's economic health.
‍

Major stock indexes on Wall Street closed higher overnight. Economists surveyed by Dow Jones expect that inflation cooled by a modest 0.1% in December from November.
‍

According to property consultancy Colliers Hong Kong, Hong Kong's property market is set to recover in 2023 in light of China's reopening and easing of Covid rules.
Hannah Jeong, head of valuation and advisory services at Colliers, told CNBC's "Squawk Box Asia" that the retail market in particular will reap the best benefit from the current situation.
‍

"We're seeing about an 8% increase in retail rental performance from last year," she said.
‍

Colliers' latest report predicts that the high street shop segment will be the "first runner" in the post-Covid recovery, with both rents and prices rising.
‍

This year, Grade A office rents will rebound by 3% thanks to pent-up demand from Chinese and overseas companies.
‍

The Bank of Japan will discuss the potential side effects of its monetary easing policies at its next policy meeting, according to a report from the Yomiuri newspaper.
The Yomiuri newspaper wrote that the market interest rate remains distorted even after the policy revision at the end of last year.
‍

The central bank increased the tolerance for yield fluctuations on 10-year Japanese government bonds (JGBs) last month, widening the range from 0.25% to 0.5% on either side of the 0% target. This move gives the central bank more flexibility in managing bond yields and helps to ensure stability in the financial markets.
‍

The Japanese yen strengthened against the greenback, rising 0.63% to 131.65.
‍

Inflation in China increased 1.8% in December compared to the same time last year, due to rising food prices, according to data from the National Bureau of Statistics.
‍

According to a report, the prices of fresh vegetables and fresh fruits rose by 7.0% and 4.7%, respectively.
‍

The CPI figure was as expected by Reuters, and higher than the 1.6% reading from the previous month.
‍

The reading was also flat with November's, improving from a 0.2% decline. This is a positive sign for the economy, as it shows that consumers are still spending despite the current situation.
‍

China's producer price index fell 0.7% in December from a year earlier, worse than expectations of a 0.1% decline.
‍

According to a fund strategist, shares of a global stock exchange are trading at a "very good" entry point for investors after a recent decline in the company's stock.
Hannah Gooch-Peters, global equity investment analyst at Sanlam Investments, said that in the past year, the stock exchange had done well due to the volatility in the fixed-income markets and the high spot prices of commodities.
‍

Gooch-Peters, who is part of the team behind the outperforming Sanlam Global High-Quality Fund, said that the company is an attractive long-term investment due to its large recurring business model.

‍
Australia reported a trade surplus of 13.2 billion Australian dollars (about $9.1 million) for November, which was higher than the Reuters forecast of AU$10.4 billion.
The November trade surplus of AU$15.31 billion represents an increase from October’s figure of AU$12.74 billion. This is a positive sign for the Australian economy, indicating that exports are growing at a faster rate than imports.
Australia's imports fell by 1.5% in November from October, while exports dipped 0.4%. This was the first time in three months that imports had fallen, and the second consecutive month of decline for exports.
‍

China's tech sector has been under pressure in recent years, due to a regulatory crackdown and the fallout from the country's zero-Covid policy.
Wall Street is starting to show some love for Chinese tech stocks again, and Morgan Stanley has named its “top pick” in the sector.
As a Pro subscriber, you can read more articles on our site. This gives you access to exclusive content that you can't find anywhere else.
Cryptocurrencies surged after crypto exchange Binance announced it is planning to increase its staff by between 15% and 30% in 2023. The move signals confidence in the future of the digital currency market.
‍

Bitcoin was up 2.78% at $17,932.69, according to data from Coin Metrics. Ether was up 3.86% at $1,388.98.
Binance's decision to continue hiring stands in contrast to rivals like Coinbase, Kraken and Huobi, which have laid off large numbers of employees amid a crypto downturn.
‍

Stocks rose on Wednesday as investors bet on a positive inflation report due out on Thursday. The consumer price index is a key measure of inflation, and a strong reading could signal that the economy is heating up.
‍

The Nasdaq Composite index gained 1.8% over the course of four days, the longest such streak since September. This rally was driven by strong performance from tech stocks.
‍

The Dow Jones Industrial Average closed up more than 260 points, or 0.8%, on Wednesday.
‍

The S&P 500 rose by 1.3% today, with all 11 sectors finishing the day in positive territory. Real estate led the way, gaining 3.6%.
‍

Natural gas prices fell to their lowest level in nearly two years on Wednesday. The sharp drop was driven by concerns about weak demand and ample supplies.
The price of the commodity slid 1.1% to $3.598.
‍

Natural gas prices fell to a new low on June 24, 2021, when the price dropped to $3.415. This is the lowest price seen since June 24, 2021, when natural gas prices fell to $3.442.
‍

Natural gas prices have declined significantly since the beginning of 2023, falling by nearly 19%. This decrease in price is likely due to a variety of factors, including increased production and lower demand.
‍

A report due out on Thursday could show that inflation is running at a hotter pace than what Wall Street analysts are expecting, according to a gauge from the Cleveland Federal Reserve. This could have implications for monetary policy and interest rates down the road.
‍

The central bank's Inflation Nowcasting tracker is pointing to headline CPI increasing at a 0.1% monthly pace, while core inflation, excluding volatile food and energy prices, is indicating a 0.5% gain. This suggests that inflationary pressures are starting to build, albeit at a modest pace.
‍

Both numbers are ahead of the Dow Jones consensus estimates for a decrease of 0.1% on headline and gain of 0.3% on core. This is good news for the economy, as it indicates that growth is continuing despite some headwinds.
‍

The Cleveland Fed model is predicting annual headline growth of 6.6% and core growth of 5.9%, compared to respective estimates from Dow Jones of 6.5% and 5.7%.