Asian Stock Market: Stocks Were Mostly Lower, Japan Is No Longer In Deflation
Following the significant rise in U.S. bond yields and the strengthening of the US dollar today, the Asian stock market is expected to face a downward trend at the start of trading on Friday.
On Thursday, Wall Street showed late declines with the S&P 500 and Nasdaq dropping by 0.3%, which might encourage investors to adopt a vital approach on the weekend. This caution could potentially turn Asian stocks from what would have been its seventh weekly rise in eight weeks.
In the past weeks, policymakers, including Prime Minister Fumio Kishida and Suzuki, have stated that the country is not currently in a position to declare a definitive exit from deflation.
On Friday, Finance Minister Shunichi Suzuki announced that Japan’s economy is no longer in deflation and that there is now a notable trend of significant wage increases on the way. In addition, the government will mobilize all available policy steps to continue the positive sentiment on wages. However, Suzuki declined to comment on Bank of Japan policy steps as its meeting taking place next week.
Japan’s Nikkei 225, went down by 0.26% closing at 38,707.64. Its current track is one of the worst weeks this year. The MSCI Asia ex-Japan index, on the other hand, would need to avoid dropping by 0.5% or more to notch a weekly gain.
Nikkei’s progress is no surprise since it hit a record high above 40,000 points in the past two weeks and the Bank of Japan could deliver its first interest rate hike in 17 years next week.
Meanwhile, the rest of the Asian stocks are mostly lower today, with the Hang Seng index going down by 1.42% closing at 16,720.89. South Korea’s Kospi also experienced a dip of 1.91%, closing at 2,666.84 along with Nifty 50 also going down by 0.56% to close at 22,023.35.
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