Hang Seng Index, ASX 200, Nikkei 225: China, Earnings, and NVIDIA

Overview of the Thursday Session

On Thursday, the Nikkei climbed to a new record high. NVIDIA (NVDA) earnings results and unsurprising FOMC Meeting Minutes supported market risk sentiment. The ASX 200 and Hang Seng Index recovered from intra-day losses to wrap up the day in positive territory.

Investors reacted to the FOMC Meeting Minutes, which gave no surprises to influence bets on Fed interest rate moves. On Wednesday, the Nasdaq Composite Index declined by 0.32%. However, the Dow and S&P 500 ended the session up 0.13% and 0.13%, respectively.

After the US market closing bell, NVIDIA earnings fueled an after-hours 9.07% rally, ending the session at $735.94. Better-than-forecast NVDA earnings limited the effect of private sector PMIs on the Asian equity markets.

PMI numbers from Australia signaled weaker private sector activity, easing pressure on the RBA to hike interest rates. PMI numbers from Japan highlighted a less marked increase in input and selling prices, testing bets on an April BoJ pivot from negative rates.

Beyond the economic calendar, corporate earnings also moved the dial. Lenovo Group (HK: 0992) and Fortescue Metals (ASX: FMG) were among the big names to release earnings.

US Services, the US Labor Market, and Fed Speakers

On Friday, Fed chatter, US private sector PMI, and labor market data from Thursday could set the tone for the Asian session. The US Services PMI declined from 52.5 to 51.3 in February. Notably, cost pressures softened while charge inflation accelerated. US initial jobless claims fell from 213k to 201k in the week ending February 17.

FOMC member Philip Jefferson warned about cutting inflation too far.

Fed chatter and the economic indicators influenced sentiment toward Fed interest rate goals. However, investors brushed aside the data and Fed comments. The NVIDIA effect fueled demand for riskier assets. On Thursday, the Nasdaq Composite Index and S&P 500 surged 2.96% and 2.11%, respectively. The Dow ended the session up 1.18%.

The US data and Fed chatter from Thursday will influence. However, it’s essential to consider Asian earnings, economic data, and policy chatter. Standard Chartered (HK 2888) is among the big names to release earnings on Friday.

House price data from China will also garner investor interest. Economists forecast house prices to decline 0.7% year-on-year in January, House prices were down 0.4% year-over-year in December.

On Friday, the ASX 200 futures were 32 points. The Nikkei is closed in recognition of the Emperor’s birthday.

ASX 200

The ASX 200 gained 0.04% on Thursday. Oil and tech stocks ended the session in positive territory. The S&P ASX All Technology Index (XTX) rose by 0.18%.

Oil stocks Woodside Energy Group Ltd (WDS) and Santos Ltd (STO) saw gains of 0.83% and 0.14%, respectively.

However, bank, gold, and mining stocks had mixed Thursday sessions.

BHP Group Ltd (BHP) and Rio Tinto Ltd. (RIO) declined by 0.38% and 1.14%, respectively. Fortescue Metals Group Ltd. (FMG) bucked the trend, rallying 2.13% on better-than-expected earnings.

Gold (XAU/USD) stocks Northern Star Resources Ltd. (NST) fell by 0.84%, while Evolution Mining Ltd. gained 0.33%.

The big four banks ended the Thursday session in negative territory. National Australia Bank Ltd. (NAB) and Westpac Banking Corp. (WBC) ended the day down 0.39% and 0.28%, respectively. The Commonwealth Bank of Australia (CBA) and ANZ Group Holdings Ltd (ANZ) fell by 0.15% and 0.08%, respectively.

Hang Seng Index

On Thursday, the Hang Seng Index recovered from early losses, ending the session up 1.45%. Property and tech stocks consolidated gains from Wednesday. The Hang Seng Mainland Properties Index (HSMPI) gained 0.87%. The Hang Seng Tech Index (HSTECH) rose by 1.75%.

Alibaba (9988) and Tencent (0700) recorded gains of 2.67% and 0.90%, respectively.

However, bank stocks had another mixed session. China Construction Bank (0939) and Industrial Commercial Bank (1398) rose by 1.85% and 0.74%, respectively. HSBC (0005) fell by 1.08% as investors continued to react to an 80% slump in Q4 profits.

The Nikkei 225

(Graph for reference purposes only)

The Nikkei rallied 2.19% on Thursday, with a new record high making the headlines.

Bank stocks ended the Thursday session in positive territory. Sumitomo Mitsui Financial Group Inc. (8316) and Mitsubishi UFJ Financial Group Inc. (8306) gained 0.87% and 0.98%, respectively.

However, the main components of the Nikkei had another mixed session.

Softbank Group Corp. (9948) and Tokyo Electron Ltd. (8035) rallied 5.14% and 5.97%, respectively. Investors reacted to the NVDA earnings and outlook, signaling sustained demand for AI chips. Sony Group Corp. (6758) Fast Retailing Co. Ltd. rose by 0.95% and 3.15%, respectively.

However, KDDI Corp. (9433) bucked the trend, declining by 0.84%.

For upcoming economic events, refer to our economic calendar.