Asian stocks rise as tech leads, Nikkei steady

Nikkei 225 gained 0.2%, while the TOPIX advanced 0.4%

Most Asian stocks rose on Friday amid some strength in technology shares, while Japanese markets held on to mild gains after the Bank of Japan kept interest rates unchanged as expected.

The BOJ hiked its inflation and growth forecasts, with focus now turning to an address by BOJ Governor Kazuo Ueda later in the day.

KOSPI outperformed its peers this week on strength in tech, while Nifty 50 lagged.

Nikkei 225 gained 0.2%, while the TOPIX advanced 0.4%, with both indexes trimming some gains after the BOJ decision.

The central bank left rates unchanged at 0.75% in a nearly unanimous decision, and hiked its growth and inflation forecasts for fiscal 2025 and 2026, citing support from increased government spending.

Focus is now squarely on Ueda’s press conference later in the day. The BOJ, in its monetary policy statement, largely reiterated its stance that it will raise interest rates as growth and wages gain traction.

The BOJ is expected to remain on hold until at least March or April, when the results of springtime wage negotiations will give the central bank more clarity on the economy and wages.

Soft inflation data for December, released earlier in the day, cast some doubts over the BOJ’s rate hike outlook. Headline consumer price index inflation dropped to a near four-year low in December, while underlying inflation remained sticky.

Most Asian markets rose on Friday on strength in tech stocks spruced up sentiment towards artificial intelligence.

But most markets were set for a muted weekly performance, following mixed growth prints from China and heightened fiscal concerns in Japan.

KOSPI added 0.6% and traded just below a record high on sustained strength in technology and automaking shares. The index was the best performer in Asia this week with a 2.5% gain.

Shanghai Shenzhen CSI 300 and Shanghai Composite indexes moved in a tight range, while Hang Seng index gained 0.4%.

ASX 200 added 0.3% on Friday, while Straits Times index gained 0.9%.

Nifty 50 index shed 0.1% in morning trade, and largely lagged its peers with a 1.6% decline this week.