Asian stocks rise after Wall St slips closer to bear market

BEIJING (AP) — Asian stock markets rose Friday after Wall Street fell closer to bear territory, China cut a key interest rate and Japanese inflation edged higher.

Market benchmarks in Shanghai, Tokyo, Hong Kong and Sydney advanced. Oil prices shed more than $1 per barrel.

Wall Street's benchmark S&P 500 index lost 0.6% on Thursday as rising interest rates, Russia's war on Ukraine and a Chinese economic slowdown added to investor unease. The benchmark is down 18.7% from its January high and close to the 20% decline that defines a bear market.

“This is unlikely to be rock bottom, given the tightening of financial conditions ahead,” said Tan Boon Heng of Mizuho Bank in a report. “Reality may again be harsher than expectations.”

The Shanghai Composite Index rose 1.2% to 3,134.24 after the Chinese central bank reduced its rate on a five-year loan, which would shore up weak housing sales by cutting mortgage costs. The one-year loan rate that affects commercial borrowers was left unchanged.

That suggests Beijing is “trying to keep easing targeted and that we shouldn’t expect large-scale stimulus,” said Julian Evans-Pritchard of Capital Economics in a report.

The Nikkei 225 in Tokyo jumped 1.3% to 26,742.67 after Japanese consumer inflation rose to 2.5% in April from the previous month's 1.3%. It was the first time since 2008 that inflation was above the central bank's 2% target.

Core inflation, which excludes fresh food and energy, rose to a seven-year high of 2.1% from March's 0.8%. Despite that, economists say the central bank is unlikely to change interest rates due to the weakness of the economy, which contracted in the last quarter.

The Hang Seng in Hong Kong gained 2% to 20,532.39 and the Kospi in Seoul advanced 1.8% to 2,638.28. Sydney's S&P-ASX 200 added...