Asia stocks drop on geopolitical tensions, Nikkei hit by strong inflation print

Investing.com– Most Asian stocks fell on Friday as an escalation in the Russia-Ukraine war dented risk appetite, while Japan’s Nikkei dropped as the yen surged on strong inflation data.

The U.S. Thanksgiving holiday left Asian markets with few overnight cues. U.S. index futures edged higher in Asia hours on Friday.

Russia on Thursday launched a second big attack on Ukraine’s energy infrastructure this month, as Moscow ramped up its offensive against Ukraine over Kyiv’s use of Western-made weapons. President Vladimir Putin threatened to use new ballistic missiles to hit “decision-making centres” in the Ukrainian capital.

Thailand’s dropped 0.2% and Indonesia’s declined 0.8%, while India’s rose marginally in early trade.

South Korea’s slumped nearly 2%, led by declines in big-cap tech shares amid concerns about an economic slowdown. Data showed that the country’s industrial output, retail sales and facility investment all fell month-on-month in October, deepening concerns about a lack of growth momentum.

South Korean major Samsung Electronics Co (KS:) fell 1.8%, and chip giant SK Hynix Inc (KS:) lost 0.7%.

Australia’s fell 0.3%, while Malaysia’s index inched 0.2% lower.

Japan shares fall as CPI data fuels BOJ rate hike bets

Japan’s fell 0.5% after the Japanese yen hit its strongest level against the dollar in just over a month, following stronger than expected inflation print from Tokyo. The index was down 0.3%.

November data showed that in Tokyo rose more than expected, pulling further above the Bank of Japan’s 2% target. The reading pointed to growing inflationary pressure and reinforced expectations that the Bank of Japan will raise interest rates in December.

BOJ Governor Kazuo Ueda had also recently reiterated the central bank’s plans to hike interest rates further, citing a “virtuous cycle” of higher wages and steady inflation.

Tech gains boost Chinese stocks