Volkswacht Bodensee - Tech fans Tokyo rally on broadly positive day for Asian markets

The rally across world markets this year has largely been fuelled by companies ploughing billions of dollars into all things artificial intelligence, and traders not wanting to miss out on the action.

That has helped push the valuations of some of the biggest names to eye-watering levels -- with US chip titan Nvidia topping $4 trillion -- and several markets to record highs.

This week has seen extra momentum after South Korean semiconductor giants Samsung and SK hynix said they had struck a preliminary deal with the ChatGPT developer OpenAI to supply chips and other equipment for its Stargate project.

And on Friday, it was the turn of Japan's Hitachi, which said it had joined into a strategic partnership with OpenAI to work on AI and energy, among other things.

Hitachi jumped more than nine percent, while other Japanese tech firms followed suit with Renesas up a similar amount, Sony gaining 2.8 percent and Advantest rising more than three percent. Tech investment giant SoftBank piled on more than three percent.

The advance helped push Tokyo's Nikkei sharply higher, while there were also gains in Sydney, Wellington, Taipei, Jakarta and Manila.

Hong Kong edged down after jumping more than four percent in the previous three trading days, while Singapore was also slightly down. Shanghai was closed for a holiday.

The rally -- which saw all three main Wall Street indexes to all-time peaks Thursday -- has also been stoked by data in recent months pointing to a slowdown in the US labour market.

That has led the Federal Reserve to cut borrowing costs and indicate more to come.

The positive sentiment has overshadowed the standoff in Washington that has seen the government partially shut down, leading to the closure of some services and the likely delay of the release of key jobs figures later in the day.

While the readings on non-farm payrolls (NFPs) is a major guide for the Fed when deciding monetary policy, analysts said the shutdown was unlikely to deter the bank from an expected second rate cut this month.

"The general vibe is that the government shutdown could potentially shave $15–$20 billion off of US GDP, but it will largely be backfilled and therefore should have only a negligible lasting impact on economic activity," said Pepperstone's Chris Weston.

"That said, there are reasons to think Trump’s threat to permanently furlough certain government workers could spill over into more of a market risk event."

Still, he added that "the probability remains that the US government will reopen in time for the NFP and possibly even the (consumer price) reports to be released ahead of the next (Fed policy) meeting on 29 October".

A Senate vote is expected Friday on a House-passed resolution to keep the government funded at current levels through November 21.

In company news, Japanese beer titan Asahi fell in morning trade after it was forced to stop production at some factories owing to a cyber attack that hit its ordering and delivery system. Officials at the firm said they did not know when they would be back up and running.

- Key figures at around 0230 GMT -

Tokyo - Nikkei 225: UP 1.4 percent at 45,584.54 (break)

Hong Kong - Hang Seng Index: DOWN 0.6 percent at 27,125.17

Shanghai - Composite: Closed for a holiday

Euro/dollar: UP at $1.1725 from $1.1720 on Thursday

Pound/dollar: DOWN at $1.3441 from $1.3446

Dollar/yen: UP at 147.61 yen from 147.19 yen

Euro/pound: UP at 87.22 pence from 87.17 pence

West Texas Intermediate: UP 0.4 percent at $60.73 per barrel

Brent North Sea Crude: Up 0.4 percent at $64.35 per barrel

New York - Dow: UP 0.2 percent at 46,519.72 points (close)

London - FTSE 100: DOWN 0.2 percent at 9,427.73 (close)

S.Spengler--VB