Investing.com-- Most Asian stocks rose on Wednesday, led by a rally in Hong Kong’s tech sector amid growing AI optimism, while gains across other regional indices remained subdued ahead of a key U.S. inflation report.

U.S. stock index futures held steady during Asian trading hours as investors assessed Federal Reserve Chair Jerome Powell’s remarks on interest rates ahead of key inflation data due later in the day.

Hong Kong stocks jump 2% as tech, EV stocks gain

Hong Kong’s Hang Seng index rose more than 2% on Wednesday, sharply higher than other regional stock indices as Chinese tech, and electric vehicle (EV) stocks surged amid AI hype.

Hong Kong-listed Alibaba (NYSE:BABA) Group (HK:9988) shares jumped more than 8% to hit a four-month high on reports of a strategic partnership with Apple Inc (NASDAQ:AAPL) to develop artificial intelligence (AI) features for iPhones in China.

EV manufacturer BYD Co (HK:1211) shares climbed 5.5% after reaching a record high on Tuesday, when the company announced plans to equip its models with advanced driver-assistance systems.

Other Hong Kong-listed Chinese tech stocks were buoyed by optimism around domestic AI breakthroughs from DeepSeek.

Tencent Holdings Ltd (HK:0700) shares gained 2.2%, while Xiaomi (OTC:XIACF) Corp (HK:1810) stock advanced 4% to a fresh record high level of HK$44.55 on Wednesday.

In mainland China, the Shanghai Composite index inched 0.2% higher, while the Shanghai Shenzhen CSI 300 index was largely unchanged. 

US inflation, interest rate jitters cap gains

Asian markets traded cautiously as investors awaited the release of U.S. consumer inflation data, which is expected to offer fresh clues on the Fed’s interest rate trajectory.