Asian markets boosted by technology stocks; Japan Posts Recession in Q4 Investing.com

© Reuters.

Investing.com– Most Asian markets rose Thursday as major technology stocks rebounded from U.S. markets, while Japan’s Nikkei 225 index neared a record high even as the economy unexpectedly entered a recession.

But while Japanese markets shone, gains across Asia were much muted as risk aversion remained amid waning expectations of an early interest rate cut from the Federal Reserve.

Regional markets saw positive gains on Wall Street, with U.S. stock benchmarks rising overnight as continued hype around artificial intelligence and some strong performance led gains in major technology stocks.

, futures were lower in Asian trade. Analysts said U.S. stocks were likely to suffer more losses after Tuesday’s higher-than-expected inflation data.

The Nikkei 225 is near an all-time high as a fourth-quarter recession upsets BOJ rate hike bets.

It rose 0.7% to 37,982.50 points, hitting a 34-year high. The index is also close to its all-time high of 38,915 points, last recorded in 1989.

The Nikkei’s gains were fueled primarily by large-cap technology stocks, with chipmakers and chip-adjacent stocks posting big gains on AI hype. Technology investor SoftBank Group Corp. (TYO:) rose 2.4% to its highest level in nearly three years, while the chip testing equipment maker Advantest Co., Ltd. (TYO:) up 1.6% Tokyo Electron Co., Ltd. (TYO:) – Japan’s most valuable chipmaker – added nearly 4%.

The metropolitan area fell 0.1%.

Data released this morning showed Japan’s unexpected contraction in the December quarter as private consumption was hit by high inflation and a weak yen. The figures show Japan has entered a technical recession after recording two consecutive quarters of GDP decline.

But the recession has prompted bets that the Bank of Japan will further delay raising interest rates from ultra-low levels. This is a trend that portends long-term monetary easing conditions for the Japanese market. This trend has been a key driver of the rise in Japanese stock markets over the past two years.

Other Asian markets also rose on strength in the technology sector. Michael Burry, famous for his involvement in the 2008 subprime mortgage crisis, took over tech giants JD.com (NASDAQ:) (HK:) and Alibaba Group (NYSE:) (HK:).

Korea rose 0.1%. Indonesian stocks were the best performers of the day, surging 1.3% after Defense Minister Prabowo Subianto appeared to be aiming to win the presidency.

Data showed Australia added 0.7% in January, reducing the impetus for the central bank to raise interest rates further. But gains on the ASX were hampered by a 2.3% fall in large miner BHP Group Ltd (ASX:) after it flagged a massive $5.7 billion impairment charge on its Brazilian operations and its Australian nickel operations.

Futures on Indian indexes were slightly open, but local technology powerhouses appeared likely to track gains in US indexes.