Volkswacht Bodensee - Asian markets rally as new US jobs data fans rate cut hopes

Eyes are now on the release of consumer price index (CPI) figures later in the day that observers say could help guide the US central bank's decision-making for the rest of the year.

Figures on Tuesday showed that the Bureau of Labor Statistics had revised down the number of new jobs in the 12 months through March by a record 911,000, suggesting the economy was slowing quicker than thought.

The reading came after news Friday of another big miss on August's non-farm payrolls report.

Fed boss Jerome Powell last month indicated cuts were in the pipeline, having batted away long-running pressure from US President Donald Trump to do so owing to worries about stubbornly high inflation.

Analysts said the only question was now how big a reduction would be made at the bank's policy meeting next week.

"The punchy revision will only accelerate the pressure on the Fed to ease in September, and throughout the balance of 2025," said Chris Weston at Pepperstone.

"While expectations could evolve if we get a benign core CPI print, at this stage, the Fed is far more likely to cut by 25 basis points and to guide with a strong bias that more cuts are to come in the months ahead."

After all three main indexes on Wall Street ended at record highs, Asia continued the positive run on Wednesday.

Hong Kong rallied to hit a fresh four-year high while Seoul was just short of a record fuelled by hopes for South Korean economic reforms.

Tokyo, Sydney, Singapore, Taipei, Wellington and Manila were also in the green.

Jakarta clawed back some of Tuesday's heavy losses that came after President Prabowo Subianto removed Finance Minister Sri Mulyani Indrawati in a cabinet reshuffle following deadly anti-government protests.

Shanghai wavered after data showed the Chinese CPI fell back into negative territory, indicating consumers in the world's number two economy were still struggling to fire on all cylinders.

Still, Fidelity International economist Peiqian Liu remained upbeat in light of last year's stimulus measures and a string of other developments including the emergence of the DeepSeek AI platform, improving exports and AI investment.

"The extension of the US-China trade truce until early November offers additional breathing room, steadying immediate trade outlooks and supporting the credibility of this year’s growth targets," she wrote.

"In response, recent economists' surveys saw consensus GDP forecasts for 2025 have been raised close to the government's target of five percent."

There was little negative reaction to news Trump had told Brussels he would hit China and India with new tariffs for their purchases of Russian oil if EU nations also did so.

Meanwhile, crude extended Tuesday's gains on renewed fears over the Middle East after Israel's strikes on Hamas in Qatar.

- Key figures at around 0230 GMT -

Tokyo - Nikkei 225: UP 0.5 percent at 43,684.29 (break)

Hong Kong - Hang Seng Index: UP 1.0 percent at 26,206.05

Shanghai - Composite: UP 0.1 percent at 3,809.48

Euro/dollar: DOWN at $1.1692 from $1.1707 on Tuesday

Pound/dollar: DOWN at $1.3518 from $1.3527

Dollar/yen: UP at 147.48 from 147.42 yen

Euro/pound: DOWN at 86.50 pence from 86.57 pence

West Texas Intermediate: UP 0.7 percent at $63.07 per barrel

Brent North Sea Crude: UP 0.6 percent at $66.80 per barrel

New York - Dow: UP 0.4 percent at 45,711.34 (close)

London - FTSE 100: UP 0.2 percent at 9,242.53 (close)

F.Stadler--VB