Asia stocks rise as reduced Fed hike bets lift tech; U.S. jobs data awaited

Asian stock markets experienced an upward trend on Friday, with technology shares driving the gains, following a rally on Wall Street. Federal Reserve Governor Christopher Waller's remarks eased concerns of an imminent interest-rate hike in the U.S. Investors closely monitored U.S. employment data released later in the day for insights into the Fed's policy direction. Major Wall Street indices climbed over 1% overnight, with futures for U.S. stock indexes remaining nearly unchanged in Asian trading.

Japan's Nikkei index surged more than 1%, with tech giant SoftBank Group surging over 10%. However, gains in Japanese shares were tempered by a significantly stronger yen, which had risen approximately 2.6% in the week due to increased market pricing for a potential Bank of Japan rate hike during its September meeting. South Korea's KOSPI index climbed 1.4%, with Samsung Electronics and SK Hynix rising by 1.6% and 2.4%, respectively.

Hong Kong's Hang Seng index jumped 2.2%, with Chinese tech companies Alibaba and Baidu each surging over 4%.

The positive sentiment for technology stocks was driven by the expectation of a softer interest-rate outlook. On Wall Street, the tech-focused NASDAQ Composite index closed 1.4% higher, with AI-related megacap stocks leading the gains. This came as markets reduced expectations for a Fed rate hike this month following Waller's comments, with the probability falling to about 50% from 63% previously, according to CME FedWatch.

Waller stated that recent data indicated signs of disinflation and suggested he would prefer to keep rates unchanged at the current policy meeting if subsequent reports further demonstrated easing price pressures. The shift in expectations also eased pressure on bond markets, with the U.S. 10-year Treasury yield last standing at 4.768% after falling overnight.

In China, the Shanghai Composite and Shanghai Shenzhen CSI 300 indices gained 0.5% each, while Singapore's Straits Times Index rose 1.1%. Australia's S&P/ASX 200 edged 0.1% lower, deviating from the regional trend. Investors now awaited the U.S. nonfarm payrolls report due later on Friday, expecting the unemployment rate to remain at 4.1%.

A weaker-than-expected report could further support the notion that the Fed would avoid raising rates this month, whereas a stronger-than-anticipated reading might revive rate-hike expectations. Oil prices remained elevated, with Brent crude near $96 a barrel, up about 7% this week, as geopolitical tensions and uncertainty about energy flows through the Strait of Hormuz persisted, keeping inflation risks in focus.