Hang Seng Index Rises on Tech Rally; Nikkei and ASX Dip on Data, Commodities

US Markets Mixed as Headline Inflation Cools

Wall Street ended Tuesday, May 13, on a mixed note as investors reacted to US inflation data. A softer-than-expected rise in consumer prices drove demand for risk assets.

The Nasdaq Composite Index and the S&P 500 gained 1.61% and 0.72%, respectively, extending Monday’s US-China trade truce-driven gains. However, the Dow fell 0.64%, weighed by UnitedHealth, which plunged 17.79%, following the CEO’s resignation and the suspension of the company’s annual forecast.

US Inflation Cools Despite Tariff Pressures

US annual inflation slowed from 2.4% in March to 2.3% in April, while core inflation remained at 2.8%. Monthly increases in consumer and core prices came in at 0.2%, below the expected 0.3%, boosting risk appetite.

President Trump reacted to the April figures, urging the Fed to cut rates, stating:

“No Inflation, and Prices of Gasoline, Energy, Groceries, and practically everything else, are DOWN!!! THE FED must lower the RATE, like Europe and China have done. What is wrong with Too Late Powell? Not fair to America, which is ready to blossom? Just let it all happen, it will be a beautiful thing!”

The US CPI Report and accompanying market optimism set the tone for the Asian markets on Wednesday, May 14.

Hang Seng Index Rebounds Amid Market Caution

On Wednesday, May 14, Asian equity markets had a mixed start to the session. The Hang Seng Index rose 0.96%, boosted by tech sector gains.

• The Hang Seng Tech Index rallied 1.42%, while the Hang Seng Mainland Properties Index dropped 0.25%.
• JD.com (09618) gained 3.21% after topping quarterly revenue forecasts.
• Tech giants Alibaba (09988.HK) and Baidu (09888.HK) advanced 1.35% and 1.95%, respectively.
• Auto stocks also contributed to the morning gains, with Li Auto (02015) and BYD Electronic International (00285) rising 1.48% and 1.70%, respectively.

Hopes of further progress toward a US-China trade deal improved market sentiment. President Trump reportedly stated he expects to work directly with China’s Premier Xi on a deal, describing the relationship as “excellent.”

In contrast, Mainland China’s equity markets edged lower, with the CSI 300 and Shanghai Composite down 0.05% and 0.08%, respectively. Investors awaited policy updates from Beijing. Earnings releases from Tencent, Alibaba, and NetEase later this week may influence sentiment.

Nikkei 225 Falls as Yen Strengthens

Japan’s Nikkei 225 declined 0.57% on Wednesday morning, as producer price data fueled expectations for a more hawkish BoJ stance. Producer prices rose 4% year-on-year in April, down from 4.3%, yet remained elevated enough to sustain inflation concerns.

The Yen strengthened, with USD/JPY falling 0.18% to 147.199 in the morning session after dropping 0.67% on May 13. A stronger Japanese Yen could dent export competitiveness.

Nissan Motor (7201) and Sony Corp. (6758) slid 3.34% and 3.23%, respectively. In contrast, tech stocks posted morning gains. Softbank Group (9984) jumped 4.01% on strong earnings.

ASX 200 Dips as Mining and Gold Stocks Retreat

Australia’s ASX 200 fell 0.19% on Wednesday morning. Mining and gold stocks dragged the Index into negative territory.

BHP Group Ltd. (BHP) and Rio Tinto Ltd. (RIO) declined 0.51% and 0.66%, respectively, as investors locked in profits from Tuesday’s gains. Northern Star Resources (NST) slid 1.75% as gold prices trended lower.

On a brighter note, Commonwealth Bank of Australia rose 0.62% after releasing an upbeat quarterly earnings report.

Outlook: Watching Trade and Beijing Stimulus

Markets remain sensitive to US-China trade-related headlines. Easing tensions and progress toward a US-China trade deal may lift risk sentiment and slow inflows into safe-haven assets. However, renewed tensions could revive demand for safe-haven assets, impacting regional stocks.

Investors should also monitor Beijing for further stimulus pledges. Fresh stimulus announcements may ease the effect of tariff uncertainties and bolster demand for Hong Kong and Mainland China-listed stocks.

Traders should remain alert and responsive to headlines on trade and central bank signals. For real-time analysis on trade talks, central bank signals, and market-moving events, click here for live coverage.