Asian shares rise, defying slow Wall Street start to 2025

HONG KONG, China — Asian markets gained on Friday, bucking retreats on Wall Street as the dollar advanced and markets reopened following the New Year's holiday.

Hong Kong, Sydney and Taipei climbed, while Seoul surged nearly two percent higher despite deepening political uncertainty in Asia's fourth-largest economy.

South Korean investigators abandoned their attempt to arrest impeached President Yoon Suk Yeol at his residence on Friday over his failed martial law bid, citing safety concerns after a standoff with his security team.

US stocks opened higher on Thursday after the New Year's break but tumbled into the red mid-session before concluding the day modestly lower.

The Wall Street losses were driven in part by disappointing results from Tesla, which slumped 6.1 percent after fourth-quarter auto sales lagged expectations.

The dollar index on Thursday hit its highest level against other currencies since November 2022, reflecting expectations that the US economy will outpace others.

"There's still no flagging of the US dollar's vigour, despite US equities struggling on the first trading day of the year," Alvin Tan, head of Asia FX strategy at RBC Capital Markets, said in a note on Friday.

"The very negative performance of China equities (Thursday) provides a better indication of the weakening sentiment around China assets at the start of 2025, and ahead of Trump's return to the White House," Tan said of US President-elect Donald Trump.

Shanghai stocks finished Friday down 1.6 percent after slumping more than two percent on Thursday while Hong Kong was up, reversing the previous day's trend.

Tokyo remains closed until Monday.

Investors are gearing up for big changes in the coming weeks, especially with January 20's inauguration of Trump, who has threatened deep tariffs, especially on Chinese goods, that could rattle international trade.

Trump's "policies especially on tariffs are inflationary in their very nature", Jung In Yun, CEO of Fibonacci Asset Management Global, said on Bloomberg Television.

"Inflation being very sticky and refusing to come down means we could have the current state of mid-level interest rates for a prolonged period of time."

US jobless claims released Thursday fell more than expected, highlighting a robust labour market and leaving the Federal Reserve with less reason to support fresh rate cuts.

Other significant economic releases ahead include data on inflation and retail sales during the holiday shopping season.

London opened slightly up on Friday, while Paris and Frankfurt started down.

- Key figures around 0830 GMT -

Tokyo - Nikkei 225: closed

Hong Kong - Hang Seng Index: UP 0.7 percent at 19,760.27 (close)

Shanghai - Composite: DOWN 1.6 percent at 3,211.43 (close)

Euro/dollar: UP at $1.0278 from $1.0269 on Thursday

Pound/dollar: UP at $1.2395 from $1.2382

Dollar/yen: DOWN at 157.34 yen from 157.52 yen

Euro/pound: FLAT at 82.92 pence

Brent North Sea Crude: UP 0.1 percent at $75.97 per barrel

West Texas Intermediate: UP 0.1 percent at $73.18 per barrel

New York - Dow: DOWN 0.4 percent at 42,392.27 (close)

London - FTSE 100: UP 0.1 percent at 8,265.31