Asian Stocks Rise As US Inflation Falls

Investors cheered signs of easing inflationary pressure in the United States on Thursday, as data showed consumer prices rose at a slower-than-expected rate in April.

The Consumer Price Index (CPI) rose 4.9 percent from a year ago in April, compared to expectations of a 5% increase, raising hopes that the Federal Reserve's interest rate hike cycle is nearing an end. CPI increased 0.4% month on month in April after increasing 0.1% in March.

"If the data remain strong in May, the FOMC will almost certainly have to revise up its GDP and inflation projections while lowering its unemployment forecast of 4.5 percent for the fourth quarter of this year." This could have significant implications for the dot plot, according to ANZ analysts in a note.

Markets are also keeping an eye on China's consumer and producer price growth data, as well as Japan's full-year earnings season, which continues with Honda, Nissan, and SoftBank Group reporting.

China's consumer prices rose at a slower pace and fell short of expectations in April, while factory gate deflation deepened, according to data released on Thursday, implying that more stimulus may be required to boost the country's patchy post-COVID economic recovery.

The Group of Seven (G7) finance leaders will begin three days of meetings in Japan on Thursday, seeking to diversify supply chains away from China while also seeking Beijing's cooperation in resolving global debt problems.

MSCI's broadest index of Asia-Pacific shares outside Japan was up 0.4% early in the Asian day.

The Australian stock market fell 0.19 percent, while Japan's Nikkei stock index fell 0.13 percent.

In early trade, China's blue-chip CSI300 index rose 0.15 percent, while Hong Kong's Hang Seng index rose 0.41 percent.

On Wednesday, a gauge of global stock markets rose and bond yields fell after data showed that consumer prices in the United States rose at a slightly slower-than-expected rate in April, indicating that the Federal Reserve is succeeding in taming high inflation.

The Nasdaq finished Wednesday at its highest intraday level in more than eight months, boosted by a lower-than-expected increase in April inflation and the latest artificial intelligence rollout from Alphabet Inc.

The Nasdaq Composite increased by 1.04 percent, while the Dow Jones Industrial Average decreased by 0.09 percent and the S&P 500 increased by 0.45 percent.

The two-year Treasury yield, which typically moves in tandem with interest rate expectations, reached 3.9222 percent, compared to a close in the United States of 3.901 percent. The yield on benchmark 10-year Treasury notes reached 3.4326 percent, up from 3.436 percent on Wednesday in the United States.

The dollar index, which measures the value of the US currency against a basket of currencies from major trading partners, fell 0.01 percent to 101.4.

The Japanese yen continued to rise and was last seen at 134.070 yen. The European single currency was up 0.1% on the day at $1.0989, after losing 0.2% in the previous month.

Oil prices rose in early Asian trade as strong demand for fuel in the United States outweighed worries about the world's largest oil producer and consumer defaulting on its debt.

US crude rose 0.54 percent to $72.95 per barrel. Brent crude is now trading at $76.81 per barrel.