Asian Stocks Rise as US Data Ease Rate Hike Fears

Hong Kong stocks rose on Monday as investors assessed fresh data from the US that tempered expectations for a Federal Reserve interest rate hike, but indicated weakness in the world's top economy.

The latest figures pointed to a softening labor market and easing inflation, leading traders to take the 'bad news is good news' approach. However, reports on Friday raised questions about the health of the US economy, with retail sales falling 0.6 percent on-month in July, the worst performance in more than a year.

Fawad Razaqzada at Forex.com noted that the data suggest 'US economic momentum may be losing some steam, strengthening expectations that the Federal Reserve could leave rates unchanged in September.' Traders now put the chances of a Fed hike at one in four, compared with 50:50 last week.

In Asia, tech firms enjoyed a recovery from July's selloff, with Hong Kong lifted by Alibaba, Tencent, and JD.com. Shanghai and Taipei were also up, while Tokyo advanced as chipmaker Kioxia soared more than 15 percent. The dollar held losses against its peers after dropping on Friday in reaction to the latest data.