TOKYO (AP) — Asian shares rose Friday as traders looked ahead to a major inflation report that could influence the Federal Reserve’s next move on interest rates.
Japan’s benchmark Nikkei 225 rose 0.4% to 39,583.08. Australia’s S&P/ASX 200 rose 0.1% to 7,768.00. South Korea’s Kospi rose 0.1% to 2,787.51. Hong Kong’s Hang Seng rose 0.3% to 17,767.93, while the Shanghai Composite rose 0.9% to 2,971.18.
In Japan, the government reported that industrial production in May was stronger than forecast at 2.8% and the unemployment rate was unchanged from the previous month at 2.6%.
On Thursday, the S&P 500 gained 0.1%, with the benchmark index hovering near last week’s all-time high.
The Nasdaq Composite rose 0.3%, remaining just shy of its all-time high. The Dow Jones Industrial Average closed 0.1% higher.
All told, the S&P 500 rose 4.97 points to 5,482.87. The Dow rose 36.26 points to 39,164.06. The Nasdaq gained 53.53 points to close at 17,858.68.
Gains at retailers and communications services companies helped offset losses at consumer goods makers, financial stocks and elsewhere in the market. Amazon.com rose 2.2% and Meta Platforms rose 1.3%.
Walgreens Boosts Alliance fell 22.2% for the biggest drop in the S&P 500. Reported results fell short of forecasts and lowered the outlook. The company said it could close hundreds more stores over the next three years.
Jeans maker Levi Strauss fell 15.4% after its latest quarterly sales results fell short of analyst expectations, as well as its current profit forecast for the year.
Spice maker McCormick rose 4.3%, one of the biggest gains on the market, after beating analysts’ earnings expectations.
Chipmaker Micron Technology fell 7.1% after its latest forecast left investors disappointed.
Government bond yields fell in the bond market. The yield on the 10-year Treasury bond, which influences interest rates on mortgages and other consumer loans, fell to 4.28% from 4.33% on Wednesday evening. The yield on the two-year government bond fell from 4.75% to 4.71%.
The stock market has been lackluster this week ahead of the release of the government’s next big inflation report on Friday. The personal consumption expenditures index, or PCE, is the Fed’s favorite inflation measure.
Economists expect the report to show a modest decline in inflation to 2.6% in May, from a reading of 2.7% in April. That’s down from the PCE’s peak of 7.1% in mid-2022. Other measures of inflation, including the consumer price index, have also fallen significantly over the past two years.
The latest updates on inflation could influence the central bank’s decision on when to start cutting interest rates, which are at their highest levels in more than 20 years and are having an impact globally. Wall Street is betting that the central bank will start cutting interest rates at its September meeting.
The U.S. economy grew at an annual rate of 1.4% from January through March, according to a government update. The figure is a slight revision from a previous estimate of 1.3%. It marks the slowest quarterly growth since spring 2022.
A slowdown in consumer spending could further ease inflation, but too much of a slowdown could lead to a more painful blow to the economy. The Federal Reserve is trying to time its efforts to return inflation to its 2% target without slowing the economy so much that it falls into a recession.
The S&P 500 is on track for its fourth straight winning week. With one trading day left this month, the index is up just under 4% for June and about 15% so far this year.
In energy trading, U.S. crude rose 47 cents to $82.21 a barrel. Brent crude, the international standard, added 46 cents to $86.85 a barrel.
In currency trading, the US dollar rose from 160.72 yen to 161.00 Japanese yen. The euro cost $1.0693, up from $1.0709.
