Investing.com– Most Asian stocks rose on Friday, buoyed by gains in the technology sector as investors cheered strong earnings from Microsoft and Alphabet, although anticipation of more cues on interest rates kept sentiment in check.
Japanese stocks also rose comparatively less than their peers, with focus squarely on the conclusion of a Bank of Japan meeting later in the day. Softer-than-expected Tokyo inflation data added to the uncertainty.
Regional markets tracked gains in U.S. stock index futures, which rose sharply after stronger-than-expected earnings from tech giants Microsoft Corporation (NASDAQ:) and Alphabet Inc (NASDAQ:). The two stocks surged in aftermarket trade, with Alphabet hitting a record high.
Gains in U.S. tech stocks largely overshadowed a weak overnight close on Wall Street, following softer-than-expected data and a higher . Focus was now on data- the Federal Reserve’s preferred inflation gauge- which is due later in the day.
Japan’s Nikkei 225 creeps higher with BOJ in focus
Japan’s index added 0.4%, while the broader rose 0.2%.
Sentiment towards Japan was largely constrained by uncertainty before the conclusion of a . While the central bank is widely expected to keep rates on hold, investors are uncertain whether it will offer up hawkish signals in the face of a weakening .
Softer-than-expected inflation data from Tokyo further added to the uncertainty. Inflation in Japan’s capital slid below the BOJ’s 2% annual target in April, giving the central bank less headroom to hike interest rates further.
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Still, gains in tech stocks supported Japanese benchmark indexes.
Asian tech upbeat following strong US earnings
Tech-heavy Asian bourses were the best performers on Friday. South Korea’s rose 1%, while Hong Kong’s index added 1.5%.
The Hang Seng also hit a five-month high on gains in oil and gas giant CNOOC Ltd (HK:), after the firm clocked stronger-than-expected quarterly earnings.
Positive earnings from the U.S. tech giants fueled hopes that demand for artificial intelligence- which was a key driver of the earnings beat- will continue to buoy tech valuations in the coming quarters. Gains in tech also saw China’s and indexes rise 0.8% and 0.6%, respectively.
Futures for India’s index pointed to a positive open, with local tech stocks also set to track broader gains.
Australia’s was the sole underperformer for the day, falling 1.3% in catch-up trade after a holiday on Thursday.
Australian stocks were also spooked by data showing an increase in inflation over the first quarter, which heralds higher-for-longer interest rates in the country.
