Asia Stocks Climb as CPI Takes Center Stage; China Declines Amid Fiscal Stimulus Discussions

Most Asian stocks showed slight gains on Thursday, as investors focused on crucial U.S. inflation data for insights on potential interest rate adjustments. In contrast, Chinese markets declined despite indications from Beijing regarding forthcoming fiscal stimulus measures.

Regional markets benefited from a positive performance on Wall Street, where the Dow Jones Industrial Average reached a record closing high following the release of minutes from the Federal Reserve’s September meeting, which suggested support for a 50 basis point rate cut. However, U.S. stock index futures remained flat during Asian trading, as the minutes also indicated that the Fed did not commit to a specific pace for future interest rate reductions.

### Chinese Stocks Decline Amid Skepticism Over Stimulus

The Shanghai Shenzhen CSI 300 and the Shanghai Composite indexes both fell approximately 0.7% amid volatile trading, extending losses following a significant drop on Wednesday. This decline occurred even after the finance ministry announced a briefing scheduled for Saturday to discuss plans for fiscal stimulus aimed at stimulating growth.

This announcement followed a disappointing briefing on Tuesday concerning recent monetary stimulus measures, leading to a sharp decline in Chinese markets from two-year highs earlier in the week. Investors expressed doubts about the extent of additional support that Beijing could provide, given the rising debt levels within the country.

Hong Kong’s Hang Seng index, however, rallied 2.5%, recovering from significant losses experienced earlier in the week. Trip.com Group Ltd was a standout performer, surging over 5% after Citigroup increased its earnings estimates for the company.

Chinese markets received some support from the People’s Bank of China, which injected 500 billion yuan (about $70.69 billion) into capital markets to enhance liquidity.

### Broader Asian Markets Rise, Eye on CPI Data

Overall, Asian markets were cautiously higher on Thursday, with attention shifting to the U.S. consumer price index (CPI) inflation data, set to be released later in the day, which may provide further guidance on the direction of interest rates.

Japan’s Nikkei 225 index rose 0.3%, while the TOPIX saw a 0.2% increase. However, gains in Japan were limited by data indicating a larger-than-expected rise in producer price index inflation for September, suggesting potential inflationary pressures ahead.

Confidence regarding China’s economic prospects contributed to a 0.6% increase in Australia’s ASX 200 index, reflecting the country’s significant trade ties to mainland China. In South Korea, the KOSPI added 0.5%, recovering after a holiday on Wednesday. Meanwhile, futures for India’s Nifty 50 index indicated a flat opening, as the index attempted to recover from recent declines from record highs.