Asian equities soar as concerns over the debt ceiling subside. On Thursday, the majority of stock indexes increased. Followed advances on Wall Street amid confidence.

Asian Stocks boosted by Sony statement

With hopes that the U.S. debt ceiling can be increased, most Asian stock markets climbed on Thursday. The Nikkei reached a 20-month top thanks to increases in the Japanese company Sony.

The Nikkei increased by 1.5%, mostly due to a nearly 6% increase in Sony Corp. (TYO:6758) shares. After the company stated it was considering about spinoff off and listing its financial services subsidiary. The gambling giant stated that the transition might take place over three years, and that it will pay dividends on shares of the new company.

Sentiment improved as a result of a greater-than-anticipated decrease in Japan’s enormous trade imbalance. Which, sided the Nikkei enter its sixth consecutive round of gains. The index has significantly outperformed its Asian counterparts this year. This is help by a strong earnings period, the durability of the Japanese economy, and the BoJ’s dovish comments.

Stock markets followed the Wall Street gains on debit ceiling likely agreement

After the Biden Administration suggested that a deal on lifting the U.S. debt ceiling might be struck as soon as this week, wider Asian markets also increased, followed advances on Wall Street.

As the time for officials to come to an agreement on June 1 gets closer, this helped allay concerns about a potential U.S. debt default.

However, the concern over slowing economic development, notably in China, restrained advances in the markets.

After a spate of dismal economic indicators from China. The Shanghai Shenzhen CSI 300 and Shanghai Composite indices increased by 0.4% and 0.8%, accordingly, to end a two-day losing streak.

Recent statistics revealed that China’s post-COVID economic recovery was losing momentum – Which is bad news for Asian markets with significant trade dependence on China.

Advances in technology equities helped markets as well, though. A 3.2% increase in Alibaba Group Holding Ltd (HK: 9988) (NYSE:BABA) shares. Which were trading before to the company’s Q1 results report coming later in the day, helped Hong Kong’s Hang Seng index increase by 1.2%.

The Big Short’s Michael Burry increasing his holdings in the dominant Chinese e-commerce company. Anticipating that the company will profit enormously from a Chinese opening this year, also helped the stock rise.

Other tech-focused indices also increased; the Taiwan Weighted index increased 1.1% and South Korea’s KOSPI increased by 0.5 percent.

The ASX 200 index in Australia increased by 0.5% after a weaker-than-expected data on job markets. Raising the chances that the Reserve Bank would hold off on further interest rate increases.

The dollar strengthens, as the Chinese yuan drops to a five-month low in Asia FX.

On Thursday, the majority of Asian currencies made  minor movements. While the dollar reached 7-week highs on hope for an increase in the US debt ceiling and in expectation of fresh monetary policy hints.

The Chinese yuan was a notable exception, falling to its lowest point in more than 5 months as worries about the nation’s economic recovery grew.

The yuan dropped 0.1% and for the first time since early December, it crossed the psychologically significant 7 barrier versus the dollar. The government and traders constantly monitor the 7 level, and its breach often signals more losses for the Chinese yuan.

The Taiwan dollar and the Singapore dollar both changed less than 0.1% in either direction. While the Japanese yen gained 0.1% after suffering significant overnight falls.

The Australian dollar decreased by 0.2% after weaker-than-anticipated employment numbers.Ssuggested that the RBA would have less economic space to continue raising interest rates.

After reaching a 7-week high in overnight trade, the dollar index futures were stable in Asian trading.

The overall agreement among officials was that inflation remains too excessive and that the Fed may still raise interest rates .

The markets are currently awaiting for more monetary policy hints from a flurry of Fed presenters this week. Particularly from Chair Jerome Powell on Friday.