Asian Shares Mixed Despite Fading Fed Hike Bets

(RTTNews) - Asian stocks ended mixed on Friday, even as signs of slowing U.S. inflation and a retreat in oil prices raised optimism that the U.S. Federal Reserve would hold interest rates steady next month.

The U.S. dollar was subdued in Asian trade ahead of retail sales and consumer sentiment readings due later in the day. Gold dipped to $4,335 an ounce but was on track for a second weekly gain on eased concerns over Federal Reserve rate path.

Brent crude futures surged above $88 a barrel, recovering losses from the previous session as talks to end the Middle East conflict and reopen the Strait of Hormuz remained deadlocked.

China's Shanghai Composite index fluctuated before finishing marginally higher at 3,927.18. Hong Kong's Hang Seng index fell 1.10 percent to 25,116.85, hitting a three-week low and marking its fourth consecutive session of losses.

Japanese markets rose notably while the yen held steady despite reports suggesting that the Bank of Japan is eying a September rate hike and could move more aggressively with subsequent increases to stem the currency's falls.

Prime Minister Sanae Takaichi's government was said to support an interest-rate hike. The Nikkei average climbed 0.59 percent to 68,713.80 while the broader Topix index rose 0.51 percent to 4,197.20.

SoftBank Group shares rose 2.9 percent and Kioxia Holdings surged 3.8 percent amid expectations that AI data center demand will fuel a multi-year chip shortage.

Seoul stocks ended sharply higher for a fifth consecutive session, with technology stocks leading the surge on renewed optimism over AI spending.

Investors also cheered data that showed South Korea's export prices surged 49.1 percent year-on-year in July, marking the largest increase since 1998 during the Asian financial crisis and signaling continued demand for Korean goods.

The Kospi index soared 2.42 percent to 6,977.94. Market bellwether Samsung Electronics rose 2.4 percent and rival chipmaker SK Hynix advanced 3.3 percent following SanDisk's cash return announcement.

Australian markets ended lower as softer commodity prices and earnings uncertainty weighed on the mining and banking sectors.

The benchmark S&P/ASX 200 dropped 0.80 percent to 9,115.20 while the broader All Ordinaries index settled 0.73 percent lower at 9,313.20.

Across the Tasman, New Zealand's benchmark S&P/NZX-50 index edged up by 0.21 percent to 13,854.38 after data showed the country's manufacturing sector continued to expand solidly in July.

Overnight, U.S. stocks closed higher as falling oil prices coupled with soft producer price inflation data reinforced bets that the Fed will keep interest rates unchanged next month.

The producer price reading was flat in July compared with expectations for a 0.2 percent increase. On an annual basis, it slowed to 4.7 percent from 5.5 percent in June.

The tech-heavy Nasdaq Composite surged 0.8 percent to reach a two-month closing high and the S&P 500 added 0.7 percent to hit a new record closing high while the narrower Dow ticked up 0.1 percent.