HK slips as region rises with US rate concerns easing

Asian markets experienced a positive shift on Thursday following US inflation data that was in line with expectations. This alleviated concerns about imminent Federal Reserve rate hikes in the near term. Simultaneously, oil prices hovered around $80 per barrel despite ongoing tensions between Washington and Tehran regarding the Gulf conflict.

In Hong Kong, the benchmark Hang Seng Index began the day down by 152 points, or 0.6%, settling at 25,288. The technology index dropped 13 points, or 0.29%, to 4,762, while the China Enterprises Index fell 45 points, or 0.54%, to 8,400. Across the border, the Shanghai Composite Index edged up 10 points, or 0.27%, to 3,957. The Shenzhen Component Index increased by 122 points, or 0.85%, to 14,536, and the ChiNext Index rose by 54 points, or 1.52%, to 3,656.

In Tokyo, the Nikkei Index opened at 68,033 before surging by 1,064 points, or 1.58%, to 68,588. In Seoul, the Kospi Index surged by 278 points, or 4.23%, to 6,857 at one point before noon, after an impressive opening of 194 points, or 2.96%, to 6,773. The market gains were driven by the small rise in US consumer prices in July, which corresponded to expectations and potentially diminished the case for an interest rate increase from the Federal Reserve in the upcoming month.

Money markets now estimate a 40% probability of a rate hike, down from 54% a week prior, according to CME Group's FedWatch. With August CPI data expected before the Federal Open Market Committee (FOMC) meeting, and crude oil futures experiencing moderate growth since July, both the Federal Reserve and markets are anticipated to closely scrutinize the data leading up to the September FOMC, said Den Miki, a senior rate strategist at SMBC Nikko Securities, in a note.

Oil prices saw a slight decline but remained relatively high in Asia, with US crude decreasing by 0.83% to $82.58 per barrel and Brent falling by 0.71% to $88.35 per barrel on the same day.