Asian stock markets experienced a strong rebound on Friday, driven by weaker-than-expected US economic data and a decline in oil prices, which together spurred demand for risk-sensitive assets. The Nikkei 225 rose by 1% to near 69,500, the Shanghai Composite increased by 0.45% to around 4,050, the Hang Seng climbed 1% to near 23,280, and the KOSPI surged over 5.8% to approximately 8,090 [1].
The rally was fueled by a reassessment of Federal Reserve policy expectations following the release of US Nonfarm Payrolls (NFP) data on Thursday. The US economy added only 57,000 jobs in June, significantly below the estimated 110,000, and the May figure was revised downward to 129,000 from 172,000 [1]. As a result, the probability of the Fed implementing at least one interest rate hike in September dropped to 53.2%, down from nearly 64% earlier in the week, according to the CME FedWatch tool [1].
Lower oil prices also contributed to the positive sentiment, particularly benefiting economies reliant on oil imports. WTI oil prices approached pre-Middle East war levels, with Oman signaling progress in indirect talks between the US and Iran, which helped ease geopolitical concerns [1].
The KOSPI notably outperformed other Asian indices, with a surge of nearly 6%, as major technology stocks such as Samsung Electronics and SK Hynix rebounded sharply after experiencing declines of over 17% in the previous two trading sessions [1].
CONCLUSION
Asian equity markets rallied strongly on Friday, led by a nearly 6% surge in the KOSPI, as weaker US jobs data and lower oil prices improved risk sentiment. The shift in Federal Reserve rate hike expectations and easing geopolitical tensions further supported the positive market momentum.