©Reuters.
Investing.com — Most Asian stocks remained in a narrow range on Tuesday as markets remained cautious ahead of key U.S. inflation data, but Japanese stocks suffered losses amid growing signs that the Bank of Japan will raise interest rates soon. has expanded.
Regional stocks largely followed Wall Street's overnight trading, as the recent risk-on rally appears to be losing steam, while uncertainty over the fate of interest rates also remains a cause for caution in the market.
Japan's Nikkei Stock Average and TOPIX fall as Bank of Japan interest rate hike appears imminent
Japanese stocks were the worst performers in Asia on Tuesday, with indexes down 1.3% and 1.6%, respectively. Both indexes hit two-week lows and are currently trading well below their record highs reached last week.
The slightly stronger-than-expected inflation rate announced on Tuesday strengthened the view that persistent inflation and firm wages will prompt the Bank of Japan to end its yield curve control and negative interest rate policy in the near term.
The figures were released just one day after multiple media reports said the Bank of Japan was considering leaving its ultra-dovish policy in mid-March or late April.
This week also focuses on wage negotiations between Japanese companies and major labor unions, with any significant wage hikes likely to draw a hawkish response from the Bank of Japan.
Uncertainty surrounding the Bank of Japan dampened sentiment toward Asian markets, as did deep doubts about China's economic recovery.
Chinese stocks hover near four-month highs, awaiting further economic stimulus measures
Chinese stocks and indexes fell slightly on Tuesday, but Monday's nearly four-month highs remained in sight.
But gains in Chinese markets slowed in recent trading amid deep doubts about China's economic recovery. The Chinese government has set almost sweeping growth targets for 2024 and has given few hints about further stimulus.
Hong Kong's index rose 0.6% due to gains in tech stocks, but remained broadly range-bound.
US CPI waits for cues to cut interest rates
Broad Asian markets remained in a narrow range on Tuesday, with Australia up 0.2% and South Korea up 0.2%.
Indian index futures signaled a positive move after falling 0.7% on Monday amid heavy profit-taking at record highs.
Investors were largely nervous ahead of key U.S. data released later Tuesday that is expected to be factored into the Federal Reserve's 2024 interest rate cut plan.
U.S. stock futures were slightly positive in Asian trading after mixed trading on Wall Street.
