APAC markets mixed as oil prices fuel inflation concerns

Asia-Pacific markets traded mixed on Friday as a surge in oil prices amid renewed United States-Iran tensions fuelled fresh concerns about inflation.

By 11:50 am AEST (1:50 am GMT), Australia’s S&P/ASX 200 was up 0.3%, while Japan’s Nikkei 225 fell 1.1% and South Korea’s KOSPI 200 declined 0.3%.

Among data releases, South Korea’s annual consumer inflation slowed in September, driven by government price control measures and falling agricultural costs, according to official data released on Friday.

The Consumer Price Index (CPI) rose 2.9% in September from a year earlier, according to the Ministry of Data and Statistics.

The increase was down from the 3.1% annual gain recorded in August and was in line with market expectations.

In Japan, Tokyo consumer inflation accelerated in September, with core prices rising faster than expected, reinforcing market expectations that the Bank of Japan (BOJ) may continue raising interest rates as price pressures remain persistent.

Tokyo’s core Consumer Price Index (CPI), which excludes volatile fresh food prices, rose 2.7% year-on-year in September, accelerating from 1.8% in August and exceeding forecasts of 2.4%.

The broader Tokyo CPI also increased 2.7% from a year earlier, compared with 1.9% in August, while the index excluding food and energy rose 0.4% month-on-month after a 0.7% gain in the previous month.

In a separate release, Japan's unemployment rate rose to 2.5% in August from 2.4% in July, deteriorating for the first time in five months, according to the Ministry of Internal Affairs and Communications.

On Thursday, US benchmarks finished slightly higher. The Dow Jones Industrial Average rose 0.04%, the S&P 500 gained 0.2% and the Nasdaq Composite added 0.04%.

In commodities, ICE Brent crude jumped 4.4% on Thursday to settle at US$102.31 a barrel, while spot gold added 0.5% to settle at US$4,177.34 an ounce.

In China, the SSE Composite Index and CSI 300 remained closed on Thursday for a public holiday.

Hong Kong’s Hang Seng Index also remained closed for a holiday, while India’s BSE Sensex fell 0.8% to close at 71,909.7, its lowest level since April.

European markets finished lower across the board on Thursday. The UK’s FTSE 100 fell 1.7% to 10,428.3, Germany’s DAX declined 1% to 24,939.4 and France’s CAC 40 dropped 1.6% to 7,835.3.