Asian Stocks Edge Higher as Investors Await U.S. Jobs Data; Japan Outperforms

Most Asian stock markets posted modest gains on Friday, tracking a mixed close on Wall Street overnight as investors remained cautious ahead of key U.S. labor market data that could influence expectations for future Federal Reserve interest rate cuts.

U.S. equities ended Thursday’s session with little overall direction. Technology shares slipped after recent gains, keeping pressure on the Nasdaq, while the Dow Jones Industrial Average and the S&P 500 closed broadly flat. During Asian trading hours on Friday, U.S. stock index futures showed little change, reflecting a wait and see mood across global markets.

Asian Markets Subdued, Japan Leads Gains

Asian equities largely mirrored the cautious tone. South Korea’s KOSPI index was mostly unchanged after reaching record highs earlier in the week on strong semiconductor performance. Major chipmakers Samsung Electronics and SK Hynix retreated between 1.5% and 3%, weighing on the index.

Australia’s S&P ASX 200 edged up 0.3%, while Singapore’s Straits Times Index traded near flat levels. Futures linked to India’s Nifty 50 also showed little movement, signaling limited conviction among regional investors.

Japanese markets stood out as outperformers. The Nikkei 225 rose 1%, while the broader TOPIX index gained 0.3%. A weaker yen supported sentiment toward export focused companies, improving earnings prospects for Japan’s globally oriented manufacturers.

China Inflation Data Offers Cautious Optimism

In China, official data released Friday showed consumer inflation accelerated to its fastest pace in nearly three years, suggesting tentative signs of improving domestic demand. The consumer price index rose 0.8% year on year in December, while monthly prices increased 0.2%. At the same time, producer price deflation eased, pointing to a gradual stabilization in factory gate prices.

The data raised hopes that China may be approaching the end of a prolonged deflationary phase that has weighed on growth, corporate profitability, and consumer confidence. Chinese equities responded modestly, with the Shanghai Shenzhen CSI 300 up 0.3% and the Shanghai Composite rising 0.6%, while Hong Kong’s Hang Seng index remained flat.

U.S. Payrolls in Focus

Looking ahead, investor attention is firmly fixed on the U.S. nonfarm payrolls report due later on Friday. The data is expected to provide clearer insight into the strength of the U.S. labor market and help shape expectations around the timing and scale of potential Federal Reserve rate cuts in the months ahead.