Asian stocks climbed on Friday October 16, after dip buyers on Wall Street soothed a chip-stock rout driven by fears over the artificial intelligence trade.
The MSCI Asia Pacific Index gained 0.6%, with South Korean shares leading the advance, the Kospi rose 1.80%. In Japan, the Nikkei 225 added 1.38% and the Topix climbed 1.75%. Hang Seng futures meanwhile rose 0.9%.
In India, GIFT Nifty which indicates how the country’s stock market would start for the day’s trade pointed to a positive start.
Indian equities had rallied strongly on Thursday, when the Nifty reclaimed the 23,000 mark in intraday trade and the Sensex surged 1,534 points. The broader market, however, lagged the frontline indices.
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Indonesia, meanwhile, remained in focus after MSCI said the country no longer merits emerging-market status. The index provider is consulting on reclassifying it as a standalone market, arguing that a move to frontier status would not reflect the severity of its problems.
“Significant concerns remain around market dysfunction, including continued suspected coordinated trading behavior and lack of evidence of meaningful enforcement,” MSCI said in a statement on Thursday.
It expects to proceed unless it finds clear evidence of material improvement in governance. Indonesia’s Jakarta Composite had closed 1.33% lower in Thursday’s session.
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Traders will also watch Chinese markets as the European Union prepares new trade powers that could shut off access to its single market entirely, part of a push to cut its trade deficit with China.
In currencies, the Japanese yen weakened 0.1% to 158.17 per dollar, while the offshore yuan hardly moved at 6.6902.
Wall Street set the tone for the region as the S&P 500 erased its earlier losses to close 0.3% higher on Thursday, and an equal-weighted version of the index jumped 1.4%, with healthcare and consumer-staples stocks leading.
Investors seemed to have grown uneasy about how heavily gains have concentrated in AI-linked shares, and this week’s sharp swings in global stocks and credit markets exposed that unease. Traders now seemed to observe whether the rebound could broaden.
The benchmark US 10-year yield fell 13 basis points to 5.06% in the New York session, and US Treasury futures edged higher on Friday.
US Federal Reserve Chairman Kevin Warsh is due to speak in a fireside chat with IMF Managing Director Kristalina Georgieva in Bangkok, and traders will scan his remarks for hints of another rate increase.
Fed officials raised borrowing costs last month for the first time since 2023, and futures now price roughly a 25% chance of a hike in October.
Oil headed for a second straight weekly gain on Friday as fresh supply threats in West Asia outweighed the prospect of another release of emergency stockpiles.
Brent crude traded near $106 a barrel in early Asian trade, at $105.7, up almost 1% on the week. West Texas Intermediate hovered around $97, with the November contract down 0.6% at $97.43.