Asia-Pacific markets set to open higher after Wall Street gains as investors assess trade climate
Jaczhou | E+ | Getty Images
Asia-Pacific markets were set to mostly climb Friday after Wall Street gained for a third straight day as tech stocks rallied.
Japan's benchmark Nikkei 225 is set to open higher, with the futures contract in Chicago at 35,690 while its counterpart in Osaka last traded at 35,560, against the index's last close of 35,039.15.
Futures for Hong Kong's Hang Seng index stood at 22,158, higher than HSI's last close of 21,909.76.
Australian markets are closed for a holiday.
Futures linked to the S&P 500 were 0.3% higher, while Nasdaq-100 futures gained 0.4%. Futures tied to the Dow Jones Industrial Average hovered around the flatline.
Overnight stateside, the three major averages closed higher thanks to strong gains in megacap tech names, as investors continued to look for signs of progress on the global trade front.
The S&P 500 ended up 2.03% at 5,484.77, while the tech-heavy Nasdaq Composite added 2.74% to finish at 17,166.04. The Dow Jones Industrial Average lagged the other two indexes, weighed down by a 6.6% drop in IBM, but still added 486.83 points, or 1.23%, at 40,093.40.
Shares of Nvidia, Meta, Amazon, Tesla and Microsoft all closed higher, propelling the major averages to their third day of gains in a row
"Investors are becoming more comfortable with the uncertainties of tariffs as earnings roll in," said Louis Navellier, chairman and founder of Navellier & Associates. "The market seems to be positioning itself for a near-term reduction in the current sky-high China tariffs," he added.
— CNBC's Lisa Kailai Han and Pia Singh contributed to this report.
Stocks rallied on Thursday, notching their third day of gains in a row.
The S&P 500 rallied 2.03%, closing at 5,484.77. The Nasdaq Composite rose 2.74% to settle at 17,166.04. The Dow Jones Industrial Average gained 486.83 points, or 1.23%, finishing at 40,093.40.
— Lisa Kailai Han
In a Thursday note, UBS strategist Sean Simonds wrote that the U.S. is increasingly approaching a recessionary regime.
"Markets pricing rapidly in a 'recessionary' direction," he wrote.
Simonds added that tariff-sensitive stocks are being "aggressively repriced" and are now down 20% relative to the market.
Meanwhile, consumer discretionary stocks could take an even bigger hit going forward.
"Consumer discretionary stocks are typically sensitive to growth slowdowns/recessions and have underperformed recently as the market pushes quickly in this direction. Earnings expectations have also been rapidly revised lower and hedge fund positioning has adjusted significantly," Simonds said. "Our models suggest more consumer discretionary downside momentum (eg. Kohls) and relative outperformance coming from communication services and utilities (eg. Live Nation and Ameren)."
— Lisa Kailai Han
The International Monetary Fund lowered its Asia economic growth forecast to 3.9% in 2025 from a 4.6% forecast made last year.
Uncertainty surrounding trade policy is a major headwind for the region, Krishna Srinivasan, the IMF's Asia and Pacific Department director, told reporters Thursday.
However, Srinivasan noted the central banks in the region have some scope to ease monetary policy that can help protect against some of the damage from trade policy.
— Hakyung Kim
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