Asian Shares Advance On Fed Bets

Asian stocks advanced on Friday amid easing COVID-19 restrictions in China and bets that the Fed might slow its current aggressive pace of rate hikes over the coming months.

Investors awaited U.S. farm employment data due later in the day for further clues about how far the Federal Reserve may tighten policy to curb price rises.

Fed Vice Chair Lael Brainard told CNBC it’s “very hard to see the case for a pause” in rate hikes and the central bank still has “a lot of work to do to get inflation down to the 2 percent target.”

Markets in China, Hong Kong and Taiwan were closed for the Dragon Boat Festival holiday.

Japanese shares rallied to hit an almost two-month high as the country and the U.S. signed a revision on the “beef safeguard” mechanism under the U.S.-Japan Trade Agreement. The Nikkei average climbed 1.27 percent to 27,761.57 while the broader Topix index closed 0.35 percent higher at 1,933.14.

Fast Retailing jumped 5.9 percent after the apparel company said Uniqlo same-store and e-commerce sales in Japan increased 17.5 percent year-on-year in May. Tech stocks surged, with Tokyo Electron and SoftBank Group both rising over 2 percent.

Z Holdings jumped 5.1 percent on fund raising reports while Toshiba gave up 2.4 percent after revealing it had received eight initial proposals to go private.

Seoul stocks rebounded from the previous session’s sharp fall as OPEC agreed to pump more crude oil over the next two months, helping ease some inflation worries.

The Kospi average inched up 0.44 percent to close at 2,670.65. Chemical firm LG Chem gained 2.6 percent and refiner SK Innovation surged 4.6 percent.

Australian markets rose notably, led by gains in the mining and technology sectors. Strong iron ore price lifted BHP and Rio Tinto up 2.5 percent and 2.7 percent, respectively.

Lithium miners Pilbara Minerals, Liontown Resources and IGO jumped 4-7 percent. In the tech sector, Block shares surged 4.5 percent and Xero added 1 percent.

The benchmark S&P/ASX 200 index rose 0.88 percent to 7,238.80 while the broader All Ordinaries index ended 0.97 percent higher at 7,472.40.

New Zealand’s S&P/NZX 50 index rose 0.60 percent to 11,417.34, with heavyweights Mainfreight, Auckland International Airport and Meridian Energy all gaining around 2 percent. The benchmark index jumped 3.2 percent for the week, marking its best weekly gain in four months.

U.S. stocks finished higher overnight to snap a two-day losing streak, as bets that the Fed will slow the pace of rate hikes outweighed weak private payrolls data and the latest bleak corporate earnings forecast from Microsoft.

The Dow rallied 1.3 percent, the tech-heavy Nasdaq Composite surged as much as 2.7 percent and the S&P 500 added 1.8 percent to reach their best closing levels in almost a month.