Asian Stocks Soar as BOJ Hikes Rate to 1.25%, Oil Prices Fall

Asian stocks surged on Friday as lower oil prices eased inflation concerns and the Bank of Japan raised its policy rate to 1.25% in a move that some analysts described as relatively dovish.

The Nikkei index rose 1.70% to 65,228, while the Hang Seng Index gained 0.20% to 4,102.51 and the Kospi rose about 0.5%. The Bank of Japan's decision came against a stronger Wall Street backdrop, with the Dow Jones Industrial Average jumping 1.7% overnight.

The retreat in oil continued to support risk sentiment, with Brent crude falling 1.2% to $103.56 a barrel as traders focused on possible diplomatic progress in the U.S.-Iran war. The Bank of Japan's Governor Kazuo Ueda is due to hold a press conference later on Friday.

The chip rally strengthened after a volatile week for AI trade, with the Philadelphia Semiconductor Index jumping 2.7% and Taiwan's TSMC rising 5.8%. China's CSI 300 Index gained 1.1%, while Hong Kong's Hang Seng Tech Index rose 0.9%.