Asian Markets Await U.S. Payroll Data Amid Trade and Rate Concerns

Asian stocks edged higher as investors anticipate U.S. payroll data, while tension eases surrounding potential trade wars. The yen's surge signals more rate increases in Japan, while China's AI sector boosts Asian market sentiments. Geopolitical and economic data spur market caution and volatility.

Asian stocks edged higher on Friday, as investors awaited crucial U.S. payroll data. The modest rise came amid hopes that a broader trade war might be averted. Meanwhile, the Japanese yen hit its highest level in nearly two months, fueled by expectations of more rate hikes by Japan's central bank this year.

The recent actions by U.S. President Donald Trump, including tariffs on Mexico and Canada, have made investors cautious, though Beijing's measured response has kept the door open for negotiations. In this context, Asian market sentiment was particularly buoyed by significant developments in China's AI sector, notably a breakthrough by start-up DeepSeek.

Despite political uncertainties, the fears of a global trade war are receding, with markets seeing the U.S. as a resilient economy amid geopolitical concerns. However, investors are aware that forthcoming economic data, especially regarding employment, could introduce further volatility into the market landscape.

(With inputs from agencies.)