Asian Stocks Rise as Technology Stocks Recover from Nvidia-Induced Losses
Asian stocks saw a positive trend on Friday as technology stocks bounced back from losses caused by Nvidia, while Chinese shares rebounded from more-than six-month lows due to month-end bargain buying. Despite this, most regional markets were still on track for a loss in August as they struggled to recover from significant losses earlier in the month.
The positive momentum in Asian markets was supported by Wall Street's record high, driven by buying in economically sensitive stocks. The losses in Nvidia had initially pulled down the tech sector, but the situation seemed to be improving as Nvidia and U.S. stock index futures rose in aftermarket trade.
Investors were closely watching the U.S. data scheduled for release later on Friday, especially the inflation gauge preferred by the Federal Reserve. Expectations for interest rate cuts were influenced by optimism over lower rates, which helped Asian markets reduce some of their August losses as traders priced in the certainty of a rate cut in September.
Chinese stocks, which had been hit hard by capital outflows in August, rebounded with the Shanghai and Shenzhen indexes rising by 1% and 0.5%, respectively. However, they were still set to end the month with losses between 3% and 4%. In contrast, Hong Kong stocks outperformed their Asian counterparts, with the Hang Seng index rising by 1.1% on Friday and heading for a 2.6% gain in August.
Japan and South Korea were heading for losses in August, with the Nikkei and TOPIX indexes in Japan set to lose more than 1% each despite some recovery from early-August losses. South Korea's KOSPI index was on track for a 3.3% loss this month after facing an extended rout in the tech sector. On the other hand, Australia's ASX 200 index was resilient with limited losses in August, supported by flows into economically sensitive sectors.
Looking ahead, futures for India's Nifty index indicated a positive opening after hitting record highs, driven by optimism over the country's economic prospects. The Nifty and Sensex indexes were trading up by 0.8% and 0.4%, respectively, for August.
In conclusion, despite the ups and downs in the Asian markets in August, the overall sentiment was positive as technology stocks recovered and investors anticipated interest rate cuts. It is essential for investors to stay informed about global economic trends and market movements to make informed decisions about their finances.