Asian equities tremble ahead of US inflation hints; China recovers

As Chinese markets recovered from steep losses in the previous day, most Asian equities traded in a flat-to-low range on Thursday in anticipation of further clues about U.S. interest rates from important inflation data.

While U.S. stock futures declined in Asian trade, regional markets followed Wall Street's mediocre overnight performance. This was due to warnings from many Federal Reserve officials that the central bank still had a long way to go in reducing inflation.

The PCE price index data, the Fed's favoured measure of inflation, is expected later in the day, and their remarks caused markets to become even more agitated. It is anticipated that the data would confirm that US inflation stayed high in January.

A collection of economic data that was made public on Thursday gave the Japanese economy a mixed picture. In January, industrial production decreased far more than anticipated, although retail sales increased more than anticipated.

The release of the data coincided with growing ambiguity about the Bank of Japan's intended timeline for interest rate hikes. Bets that the BOJ would end its zero interest rate policy as soon as April increased in response to hotter-than-expected inflation statistics revealed earlier this week.

China's Shanghai Composite and Shanghai Shenzhen CSI 300 indices increased by 0.9% and 0.8%, respectively, following a session in which they fell more than 1% apiece due to fresh worries about a crisis in the real estate sector. A creditor's liquidation petition for troubled developer Country Garden Holdings Company sparked worries.

The promise by China's security authority to further tighten its grip on the futures market in an effort to boost investor confidence propelled Thursday's advances. In an effort to support regional markets, the regulator has implemented a number of additional restrictions in recent weeks, one of which is the restriction on short sales.

Now, all eyes will be on the crucial Chinese purchasing managers index data for February, which is anticipated to provide more hints about a possible economic rebound in the nation this Friday.

Key Data today:

• German CPI at 13:00GMT
• US Core PCE Price Index at 13:30GMT
• US initial Jobless Claims at 13:30 GMT
• Canada’s GDP at 13:30 GMT

(Sources: investing.com, reuters.com)