Singapore – Asia-Pacific stock markets closed mixed on Friday, as investors reacted differently to the release of regional economic indicators and news of ongoing communication between the United States and China.

Japanese stocks saw gains. The Nikkei 225 index rose 0.47% to close at 37,160.47, while the Topix index gained 0.68% to 2,735.52. In contrast, South Korean stocks traded flat. The Kospi index closed largely unchanged at 2,592.09, and the Kosdaq index ended down 0.24% at 715.98.

Australia's S&P/ASX 200 index finished up 0.15% at 8,360.9. Hong Kong's Hang Seng index and mainland China's CSI 300 index traded flat. The Shanghai Composite index recorded a 0.94% decline, closing at 3,348.37.

 
Key Economic Data Releases and Market Impact

Japan's April core Consumer Price Index (CPI) rose 3.5% year-on-year, indicating an acceleration of inflation. This figure exceeded the 3.4% consensus forecast compiled by Reuters and, according to LSEG data, is the highest since January 2023. The core CPI, which excludes fresh food, is expected to provide strong grounds for the central bank to consider an exit strategy from its decades-long ultra-loose monetary policy. The rise in rice prices, in particular, is analyzed to have contributed partly to the accelerating inflation.

South Korea's April Producer Price Index (PPI) rose 0.9% year-on-year, showing a slower increase compared to the previous month (1.3%). On a monthly basis, it declined by 0.1% after two consecutive months of no change. The Producer Price Index tracks price changes among producers, differing from the Consumer Price Index, which tracks price changes directly paid by consumers.

Singapore's April core CPI increased by 0.7% year-on-year, surpassing Reuters' forecast of 0.5%. New Zealand's first-quarter retail sales figures were also released, leading to further analysis by investors.

 
US-China Relations and Trade Negotiation Trends

The United States and China have agreed to continue communication. In a statement released by China's Foreign Ministry on Friday, it was announced that both sides exchanged views on important issues after a phone call between Chinese Vice Foreign Minister Ma Zhaoxu and U.S. Deputy Assistant Secretary of State Christopher Landau. This can be interpreted as a positive sign suggesting progress in US-China trade relations.

Meanwhile, Eurasia Group analyzed that the probability of a comprehensive trade agreement between the United States and Japan being concluded by the G7 summit in Canada in mid-June has decreased from 65% to 55%. While both leaders have strong incentives for a swift agreement, the issue of Japanese tariffs on U.S. automobiles remains a stumbling block, slowing down negotiations. However, David Boling, Director of Japan and Asia Trade at Eurasia Group, stated that if the U.S. agrees to negotiate on Japanese automobile tariffs, the likelihood of an agreement would increase.

 
US Stock Market and Treasury Yield Trends

U.S. stock futures saw minor fluctuations as investors continued to assess the impact of rising Treasury yields on the economy. Dow Jones Industrial Average futures rose 14 points (0.03%), Nasdaq 100 futures saw a slight decline, and S&P 500 futures gained 0.03%.

Overnight, U.S. stock markets closed mixed. The Dow Jones Industrial Average closed down 1.35 points at 41,859.09, the S&P 500 fell 0.04% to 5,842.01, and the Nasdaq Composite rose 0.28% to 18,925.73. This appears to be the result of investors grappling with concerns over interest rate hikes combined with anxieties about the expanding U.S. fiscal deficit. Notably, the 30-year Treasury yield reached its highest level since 2023, which is interpreted as reflecting investors' concerns that legislation passed by Congress could worsen the U.S. fiscal deficit. Citi forecasts weaker economic growth in the second half of the year, partly attributed to U.S. consumers and businesses front-loading spending ahead of tariffs.

 
Kazakhstan Aims to Be Central Asian Trade Gateway

Kazakhstan aims to become the gateway for Central Asian trade. Renat Bekturov, Governor of the Astana International Financial Centre (AIFC), told CNBC that "in the modern world, where there are tariffs and geopolitical tensions, companies need a stable point, a place where they can connect East and West." He also noted a "tremendous" increase in trading volumes at the Astana International Exchange, adding that while the annual trading volume for 2024 is still modest at $1.3 billion, it is double that of the past five years. This suggests that Kazakhstan is growing into an important financial hub in the Central Asian region.

 
India Considers Attracting Foreign Investment and Secondary Listings

Tuhin Kanta Pandey, Chairman of the Securities and Exchange Board of India (SEBI), announced that SEBI is considering "some proposals" to increase secondary listings through instruments such as Depository Receipts. He added that it is currently at the "preliminary proposal" stage. Furthermore, SEBI is actively engaging with Foreign Portfolio Investors (FPIs) and continues to operate an FPI outreach cell to help them access the Indian securities market, making it easier for foreign investors to invest in Indian stocks. This can be interpreted as a move to further enhance the openness and internationalization of India's capital markets.