Japan's Topix hits record high as Asia-Pacific stocks climb on trade deal optimism

Asia-Pacific markets opened higher as the latest trade developments between the U.S. and Japan, as well as positive signs for a deal with the European Union, spurred investor optimism.

Overnight in the U.S., the S&P 500 climbed 0.78% to a record close of 6,358.91 — its 12th of the year.

Japan's Topix hits record high as Asia-Pacific trading starts

Japan's broad-based Topix rose 1.2% to hit a record high in early Asia trading hours, data from LSEG showed.

The benchmark Nikkei 225 rose 1.09%, extending gains from Wednesday following the announcement of Japan's trade deal with the U.S.

South Korea's Kospi rose 1.17% at the open, and the Kosdaq Index inched 0.64% higher.

Australia's S&P/ASX 200 rose 0.15%.

Nvidia supplier SK Hynix second-quarter profit and revenue hit record highs, topping estimates

South Korea's SK Hynix stocks jumped 2.6% after it posted record operating profit and revenuein the second quarter on sustained demand for its high bandwidth memory technology used in generative AI chipsets.

Here are SK Hynix's second-quarter results compared with LSEG SmartEstimates, which are weighted toward forecasts from analysts who are more consistently accurate:

• Revenue:22.23 trillion won ($16.17 billion) vs. 20.56 trillion won
• Operating profit:9.21 trillion won vs. 9 trillion won

Revenue rose about 35% in the June quarter compared with the same period a year earlier, while operating profit rose nearly 69% year on year.

On a quarter-on-quarter basis, revenue rose 26%, while operating profit jumped 24%.

Read the full story here.

South Korea avoids technical recession as GDP expands 0.6% in second quarter

South Korea avoided a technical recession as its economy expanded by 0.6% from the previous quarter, beating expectations, according to advance estimates.

This was higher than the 0.5% expected by economists polled by Reuters, and a reversal from the 0.2% contraction seen in the first quarter.

On a year-over-year basis, the country's GDP rose 0.5%, up from 0% in the first quarter and higher than a 0.4% expansion expected by the Reuters poll.

Total consumption, which includes private and government expenditure, increased 0.7% from the previous quarter, a stronger showing compared to the 0.1% contraction seen in the first three months of the year.

Read the full story here.

Asia-Pacific markets set to start the day mostly higher

Good morning from Singapore! Asia markets were poised for a mostly higher open.

Japan's benchmark Nikkei 225 was set to start the trading day higher, with the futures contract in Chicago at 41,745 and its counterpart in Osaka at 41,730, against the index's last close at 41,171.32.

Futures for Hong Kong's Hang Seng index stood at 25,540, pointing to a marginally stronger open compared with the HSI's last close of 25,538.07.

Conversely, Australia's S&P/ASX 200 was on track to start the day lower with futures tied to the benchmark at 8,721, compared with its last close of 8,737.2.

Stocks finish Wednesday's session in the green

Stocks ended the session higher on Wednesday, with the S&P 500 finishing with its third consecutive record closing high this week.

The broad market index gained 0.78% to close at 6,358.91.

Additionally, the blue-chip Dow Jones Industrial Average moved 507.85 points higher, or 1.14%, to end the session at 45,010.29. The tech-heavy Nasdaq Composite also jumped 0.61% to finish at 21,020.02, its first close above the 21,000 level.

U.S.-Japan trade deal could hurt Japan's economy, UBS says

Although the trade deal between the U.S. and Japan turned out to be better than the market expected, it might still cause some damage to Japan's economy, according to UBS.

“The 15% tariff will still likely lead to declines in exports and corporate earnings, and the resulting stagnation in capital investment and consumption will likely continue to exert downward pressure on the Japanese economy by about 0.4 percentage points year over year, in our view,” analyst Chisa Kobayashi wrote on Wednesday.

Along with that, Kobayashi said that she does not expect the Bank of Japan to hike interest rates this year, adding that she anticipates that the next rate hike will be “only be after mid-2026.”