Asian Stocks Gain As China GDP Growth Slightly Beats Estimates Amid Fall In Fed Cut Bets

Most stocks in Asia reversed early losses after China's economic growth marginally beat analyst expectations while traders dialled down rate cut bets on strong retail sales data.

Japanese Nikkei was 150 points, or 0.4%, higher at 39,060 while the South Korean Kospi was down 13 points, or 0.5%, at 2,596 as of 8:00 a.m.

The benchmark in Mainland China—CSI 300—rose over 0.5% while Hang Seng index over 1.1%.

China's gross domestic product increased by 4.6% in the July to September period from a year prior. This is the slowest pace since March 2023 and is down from a 4.7% expansion in the second quarter. Further, its industrial production rose 5.4% from a year earlier, versus economists’ forecast of 4.6% growth.

This comes after another disappointing policy briefing pulled down stocks in China on Thursday with the benchmark CSI 300 closing lower by 1.13%. The housing minister vowed to stabilise China's property market from declining further and aimed to renovate 1 million houses in 'urban villages'.

The Japanese Yen topped the psychological level of 150 per dollar after the country reported a 2.5% rise in headline inflation which met estimates. Further intervention by the central bank is on the card after the current surpassed the key level.

Meanwhile, strong retail sales in the US helped traders trim their bets on Federal Reserve rate cuts this year. Sales data in September rose more than forecast. The value of retail purchases increased 0.4% after a 0.1% gain in August.

Treasury yields in the US climbed as the bond market took a hit with rate cuts hopes coming down. The 10-year yields advanced seven basis points to 4.09%. Traders foresee less than a half-point of easing over the next two Fed meetings, Bloomberg reported.

Stocks in the region closed mixed. The Dow Jones Industrial Average and Nasdaq Composite climbed 0.37% and 0.04%, respectively, while the S&P 500 slipped 0.02%.

On the commodity front, crude oil prices were poised for increased volatility as tension escalated in West Asis with Israel killing Hamas leader Yahya Sinwar—the mastermind of last year’s Oct. 7 assault—in southern Gaza.

Brent crude was trading 0.23% higher at $74.62 a barrel as of 6:00 a.m. IST. West Texas Intermediate was up 0.25% at $70.85 a barrel.