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Asian markets rose Friday following a tech-led rally on Wall Street that helped soothe traders' concerns that the Federal Reserve will likely not cut interest rates as early or by as much as hoped this year.
US data points on inflation and jobs, and comments from central bank officials have combined with growing geopolitical tensions to drag equities in January, bringing an end to an end-of-year rally.
The readings -- showing consumer inflation topping expectations and a resilient labour market -- show the world's number one economy remained in rude health despite borrowing costs at two-decade highs.
And on Thursday, fresh figures pointed to a surprise slowdown in jobless claims, suggesting the Fed would likely have to keep rates elevated for some time to make sure inflation does not pop back up.
In light of the latest data, traders have lowered their bets on a March interest rate cut to a little more than 50 percent, down from 80 percent last week.
Still, SPI Asset Management's Stephen Innes said: "Even as hopes for rapid interest rate cuts have recently been dented... a recession-free outlook for 2024 in the United States remains a huge positive for stocks, especially as the ongoing disinflationary pressures from China and Germany provide the dovish counterbalance."
Atlanta Fed boss Raphael Bostic said he saw rates coming down in the third quarter but would be happy to cut earlier if "we continue to see a further accumulation of downside surprises in the data".
"But the evidence would need to be convincing."
The gains in New York were largely driven by a surge in tech giants including Apple, Nvidia and Amazon after chip titan Taiwan Semiconductor Manufacturing Co unveiled a strong outlook for capital spending and revenue that boosted hopes for 2024.
"TSMC’s confidence around near-term fundamentals appears to have improved significantly over the past four to five months," said analysts at investment firm Wedbush.
"We see this more bullish outlook as predicated upon some combination of optimism around a growing contribution from AI (and) better expectations for traditional end-market trends in 2024."
TSMC jumped more than six percent in Taipei, tracking an almost 10 percent jump in its US-listed firms.
And other Asian tech firms were on the rise, with Tokyo Electron and Advantest surging more than five percent in Tokyo, while Seoul-traded Samsung jumped almost three percent.
Broader markets were also enjoying a day in the sun.
Tokyo put on more than one percent thanks to the weaker yen as data showing Japanese inflation slowing eased pressure on the country's central bank to shift away from its ultra-loose monetary policy.
Taipei advanced more than two percent, while Hong Kong, Sydney, Seoul, Singapore and Wellington were also well up. However, worries over China's economy continued to weigh on Shanghai, which extended the year's losses.
- Key figures around 0230 GMT -
Tokyo - Nikkei 225: UP 1.6 percent at 36,027.41 (break)
Hong Kong - Hang Seng Index: UP 0.5 percent at 15,466.86
Shanghai - Composite: DOWN 0.4 percent at 2,833.96
Dollar/yen: UP at 148.36 yen from 148.11 yen on Thursday
Euro/dollar: UP at $1.0885 from $1.0879
Pound/dollar: DOWN at $1.2703 from $1.2708
Euro/pound: UP at 85.68 pence from 85.58 pence
West Texas Intermediate: DOWN 0.1 percent at $73.88 per barrel
Brent North Sea Crude: DOWN 0.2 percent at $79.91 per barrel
New York - Dow: UP 0.5 percent at 37,468.61 (close)
London - FTSE 100: UP 0.2 percent at 7,459.09 (close)
B.Martinez--TFWP