Asian stocks muted before more rate cues; Japan weakness continues

investing.com:

Investing.com-- Most Asian stocks stuck to a tight range on Thursday in anticipation of more cues on U.S. inflation and interest rates, while losses in Japanese markets extended into a fourth straight session amid persistent jitters over the Bank of Japan. 

Regional stocks took a middling lead-in from Wall Street, as investors continued to digest a stronger-than-expected reading on consumer inflation, while also taking profits in heavyweight technology stocks.

U.S. futures were flat in Asian trade, with focus now turning to upcoming producer price index and retail sales data. 

The Nikkei 225 and TOPIX moved in a flat-to-low range on Thursday, with the Nikkei extending losses into a fourth straight session. Both indexes saw extended profit-taking after hitting record highs last week.

Selling in Japanese stocks was driven chiefly by growing conviction that the BOJ was close to ending its negative interest rate and yield curve control policies, and could even do so at a meeting next week.

Sticky inflation data and increased wages indicated that Japanese inflation was likely to remain well above the BOJ’s 2% annual target in the coming months- a trend that is likely to elicit an interest rate hike by the central bank.

Any tightening in monetary policy brings an end to nearly a decade of easy liquidity enjoyed by Japanese markets, a factor that also drove stellar gains in local stocks over the past two years.

Broader Asian markets moved in a flat-to-low range, as a tech rally cooled and as upcoming new loans data from China also came into focus.

China’s Shanghai Shenzhen CSI 300 and Shanghai Composite indexes hovered near four-month highs on Thursday, with a rebound rally now appearing to have run out of steam. Investors