Asian Stocks Up Thanks to U.S. Rally and Strong Earnings By

© Reuters.

By Gina Lee – Asia Pacific stocks were up on Friday morning, taking cues from both a rebound in U.S. counterparts and the latest earnings suggesting that the U.S. economy remains strong despite high inflation.

Japan’s rose 0.79% by 10:01 PM ET (2:01 AM GMT). showed that the grew 1.9% year-on-year in May 2022. The grew 2.4% year-on-year, and the grew 0.1% month-on-month.

South Korea’s rose 1.10% and in Australia, the rose 0.87%.

Hong Kong’s jumped 3.19%.

China’s was up 0.49% and the rose 1.06%.

The extended a rally from its lowest level in more than a year, after retailers including Macy’s Inc. lifted their forecasts. The gained more than 2%, while earnings from Alibaba (NYSE:) Group Holding Ltd. and Baidu Inc (NASDAQ:). boosted Chinese stocks traded in the U.S.

U.S. Treasury yields were steady, with investors retreating from safe havens as risk sentiment improved. Oil was near the $114 mark, supported by the broad-based market rally and signs of declines in US stockpiles. However, and aluminum led a fall in metals over concerns that a slowdown in China’s economic recovery will impact demand.

In Asia Pacific, China is attempting to balance its COVID-19 measures with the impact on the economy. China-U.S. tensions are also up after Secretary of State Antony Blinken aimed his comments at Chinese President Xi Jinping, saying that “under President Xi, the ruling Chinese Communist Party has become more repressive at home and more aggressive abroad.”

Global shares are set to end seven weeks of declines that made valuations attractive. However, market worries about inflation and higher interest rates, China’s economic outlook, and the war in Ukraine precipitated by the Russian invasion on Feb. 24 remain.

“We may see a little bit more stability here because we have repriced the stocks so much already,” iCapital chief investment strategist Anastasia Amoroso told Bloomberg.

“I don’t know how much this move higher is going to go because I don’t think the fundamentals really justify it near term. In the next three to six months, it’s still going to be a constrained market environment.”

The strong earnings provided a little relief to investors after Walmart (NYSE:) Inc. and Target Corp. (NYSE:) cut their outlooks during the previous week. U.S. consumers still largely expect the inflationary shock to be temporary, and for price gains to be low and stable in the longer run, the Federal Reserve Bank of New York added in a report.

Meanwhile, U.S. data, including the , and , , and the , is due later in the day.

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