Most Asian stocks fell on Friday as growing uncertainty over U.S. interest rates and heightened geopolitical tensions in Iran saw traders steer clear of risk-driven assets.
South Korea was an exception, with the KOSPI rallying to new peaks on sustained optimism over local markets after a recent technology-fueled rally.
Regional markets took a weak lead-in from Wall Street, which fell in overnight trade amid a swathe of risk-off news. S&P 500 Futures rose 0.16% by 22:37 ET (03:37 GMT), with focus squarely on key inflation and economic growth prints due later in the day.
Chinese markets remained closed for the Lunar New Year holiday.
Japan falls past soft inflation, Hong Kong slides after 3-day break
Japan’s Nikkei 225 and TOPIX indexes were the worst performers in Asia, losing 1.4% and 1.2%, respectively.
Japanese shares fell after some mixed economic prints. Data showed national consumer price index inflation sinking to a near four-year low in January, while core inflation fell but still remained above the Bank of Japan’s 2% annual target.
Separately, purchasing managers index data showed factory activity hitting a four-year high in February, aided by strong overseas demand.
Hong Kong’s Hang Seng index fell 0.6% as trade resumed after a three-day break, with local tech names tracking earlier losses in their global peers.
Alibaba Group (HK:9988) and Baidu Inc (HK:9888) were among the worst performers on the Hang Seng, sliding between 4% and 6% after the two were briefly mentioned in a U.S. government list of companies with alleged ties to the Chinese military.
BYD Co (HK:1211), which was also mentioned in the list, fell 1.6%.
Other Asian markets moved in a flat-to-low range. Australia’s ASX 200 fell 0.2%, while Singapore’s Straits Times index rose 0.1%.
India’s Nifty 50 index was flat, with local tech names skittish despite reports of several new artificial intelligence ventures in the country.
Risk appetite remained weak after U.S. President Donald Trump set a deadline of 10 to 15 days for Iran to make a deal on its nuclear program, or risk U.S. action. A host of reports showed Trump considering more strikes against the country.
South Korea outperforms, KOSPI at record high
South Korea’s KOSPI remained an outlier in Asia, rallying over 1.6% to a record high of 5,768.61 points. The index hit a record high for a second consecutive session.
While a rally in tech had driven the KOSPI’s gains on Thursday, Friday’s record high was fueled by outsized gains in brokerage, defense, and insurance stocks.
Local media reports showed a rush in buying among retail investors, despite broader selling by foreign investors.
South Korea’s top court on Thursday convicted former President Yoon Suk-Yeol to life in prison on charges of an attempted insurrection in late-2024.
Source: investing