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Asian Stock Markets Defy US Inflation Surge with Positive Closures

Asian stock markets exhibited resilience and closed on a positive note despite hotter-than-expected US inflation data. Investors appear optimistic that the US Federal Reserve (Fed) will opt to maintain interest rates during its upcoming meeting on September 19-20.

South Korea’s Composite (KOSPI) index recorded its highest level in over a week, closing at 2,572.89 points, marking a significant gain of 38.19 points or +1.51%. This surge in the South Korean market can be attributed to the belief among investors that the latest US inflation figures may discourage the Fed from raising interest rates.

In China, the Shanghai Composite index closed slightly positive at 3,126.55 points, reflecting a modest gain of 3.48 points or +0.11%. Notably, Chinese automobile stocks remained relatively unaffected by reports that the European Union (EU) was initiating an investigation into the Chinese government’s subsidies for the electric vehicle (EV) industry.

Tokyo’s Nikkei index also posted gains, closing at 33,168.10 points, an increase of 461.58 points or +1.41%. Investors in Japan remain hopeful that the Federal Reserve will reconsider its interest rate hike plans, especially after the release of the August Consumer Price Index (CPI) in the United States, which fell in line with market expectations.

Meanwhile, in Australia, the S&P/ASX 200 closed positively at 7,186.50 points, marking an upswing of 32.60 points or +0.46%. The All Ordinaries index also recorded gains, ending at 7,382.60 points, reflecting an increase of 36.90 points or +0.50%. This positive performance followed the release of favorable Australian employment data for the month of August.

Hong Kong’s Hang Seng index closed positively at 18,047.92 points, up 38.70 points or +0.21%. The release of the US Consumer Price Index (CPI) data for August contributed to the belief among investors that the Federal Reserve will maintain interest rates during its upcoming September meeting. However, some investors are not ruling out the possibility of a rate hike occurring during the November meeting.

In summary, Asian stock markets have demonstrated their resilience by closing on a positive note despite concerns stemming from the US inflation figures. Investors across the region maintain cautious optimism, with expectations that the Federal Reserve will adopt a prudent stance on interest rates in the near term.

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