Asian stocks rise as South Korea's Kospi surges; CPI, geopolitics cap gains

Asian stock markets rose Friday, with South Korea's Kospi leading gains after a strong corporate earnings season, though broader advances were tempered by concerns over U.S. consumer price inflation and geopolitical risks in the Strait of Hormuz.

The Kospi index jumped 1.8% by midday in Seoul, driven by gains in chipmakers and financials following better-than-expected earnings from major exporters. Samsung Electronics and SK Hynix advanced 2.3% and 3.1%, respectively, after reporting strong demand for memory chips. Financials such as KB Financial Group and Shinhan Financial also climbed on improved loan growth expectations.

The MSCI Asia ex-Japan index, a broad measure of regional equities excluding Japan, rose 0.6%, reflecting mixed performance across markets. Hong Kong's Hang Seng added 0.7%, while Australia's S&P/ASX 200 gained 0.4%, supported by gains in commodity-linked stocks amid firmer iron ore and gold prices.

The advance in Asian equities followed overnight losses on Wall Street, where the S&P 500 and Nasdaq Composite slipped 0.3% and 0.5%, respectively, as investors reassessed the outlook for U.S. interest rates amid rising inflation concerns. U.S. consumer price inflation data released Thursday showed a 0.3% month-on-month increase in May, slightly above expectations, reinforcing bets that the Federal Reserve may delay rate cuts.

Geopolitical tensions in the Strait of Hormuz also weighed on sentiment, with oil prices edging higher on supply disruption risks. Brent crude futures rose 0.4% to $83.45 a barrel, while U.S. West Texas Intermediate (WTI) crude increased 0.3% to $79.10 a barrel. The risk of disruptions to oil shipments through the key chokepoint added to caution among investors.

In currency markets, the Japanese yen held steady at 157.10 per dollar, while the South Korean won strengthened 0.2% to 1,385.20 per dollar. The Australian dollar was little changed at 0.6650 per U.S. dollar.

Analysts noted that while regional equities showed resilience, the combination of sticky inflation and geopolitical risks could limit further upside. "The market is balancing strong corporate earnings with macro headwinds," said a strategist at a major brokerage in Seoul. "Until there's clarity on inflation and the Fed's path, gains may remain selective."