Asia-Pacific stocks fell on Thursday despite a soft inflation report in the U.S. that saw two of the three benchmarks on Wall Street reverse course from two days of losses. The U.S. consumer price index (CPI), a broad-based measure of costs across the economy, showed February’s annual inflation rate at 2.8%. This reading brought some relief to investors, with Vishnu Varathan, Mizhuo Bank’s head of macro research in Asia excluding Japan, noting, “While this is welcome relief, it is redemption for Fed hawks concerned about price shocks piling on.” However, Varathan added that it is “premature for the Fed to let its guard down at this juncture.”
In Japan, the Nikkei 225 benchmark ended the day flat at 36,790.03, while the broader Topix index edged up 0.13% to close at 2,698.36.
Shares of Seven & i Holdings gained as much as 3.60%, following news related to Canadian convenience store operator Alimentation Couche-Tard’s bid to buy the 7-Eleven operator. This $47 billion bid, if completed, would be Japan’s largest-ever foreign buyout, although the reception from Seven & i has been mostly frosty. Elsewhere in the region, South Korea’s KOSPI index closed flat at 2,573.64, with the small-cap Kosdaq falling 0.92% to close at 722.80.
Hong Kong’s Hang Seng index dipped 0.57% to 23,463.26, while mainland China’s CSI 300 fell 0.40% to 3,911.58 in choppy trading. In Australia, the ASX 200 ended the day 0.48% lower at 7,749.10, marking the third consecutive day of declines.
Asia stocks dip despite U.S. relief
Investors are watching Indian stocks closely after the nation’s inflation rate cooled, largely due to a decline in vegetable prices. Nomura economists Sonal Varma and Aurodeep Nandi discussed that the latest inflation reading supports higher GDP growth for Q4 FY25 but noted that the magnitude is still unclear. They expect inflation to rise to around 3.8% year-on-year in March but anticipate that CPI inflation will remain below 4% in the first quarter of 2025.
India’s benchmark Nifty 50 index was down 0.18%, while the BSE Sensex was flat as of 1:30 p.m. local time. Overnight in the U.S., markets rebounded after the soft inflation report alleviated some recession fears and led to a surge in technology shares. The tech-heavy Nasdaq increased 1.22% to close at 17,648.45, while the S&P 500 gained 0.49% to end at 5,599.30.
The Dow Jones Industrial Average slipped 82.55 points, or 0.2%, to settle at 41,350.93. Leading tech sector performers included Apple, which gained 6.4%, and Microsoft, which added more than 4%.
