(Bloomberg) — Chinese technology shares led gains in Asian stocks after Alibaba Group Holding Ltd. reporting its fastest pace of revenue growth in more than a year boosted optimism toward the sector. The yen weakened past 150 per dollar.

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Equities in Hong Kong and a gauge of Asian shares advanced after Alibaba surged as much as 13% on the back of its earnings. The region’s index is in line to notch a sixth straight weekly gain, the longest winning streak in almost a year. Bank of Japan Governor Kazuo Ueda signaled a readiness to quell a surge in bond yields, comments which led the yen to post its first decline in three days.

While investors remain wary about rising geopolitical tensions and a widening tariff war, Alibaba and other Chinese technology shares have surged in recent weeks on enthusiasm over DeepSeek’s artificial-intelligence model. Global funds piling into that surge have driven a $1.3 trillion rally in Chinese stocks.

“My conviction is until China makes major structural reforms, those growth spurts are gonna be short-lived,” said Ron Temple, chief market strategist at Lazard Asset Management. “You want to trade those rallies. It’s a ‘rent don’t own.’”

Alibaba Chief Executive Officer Eddie Wu said the pursuit of artificial general intelligence is now the company’s “primary objective.” The company aims to continue to develop models that “extend the boundaries of intelligence,” he told investors on a call after earnings.

The earnings and the company’s capital expenditure plans surprised the market significantly, Morgan Stanley’s chief China equity strategist Laura Wang wrote in a note.

“This development further validates our firm belief that China’s ability to participate and even lead in the AI empowered global technology competition should be reassessed and more appreciated by global investors,” she wrote.

BOJ’s Moves

Meanwhile, the yen weakened back past 150 per dollar in Friday trading after strengthening past that key level Thursday on speculation the Bank of Japan will hike interest rates sooner rather than later. Traders are pricing in a roughly 84% chance of a 25 basis point hike at the July meeting, up from a 70% chance at the start of the month, according to data compiled by Bloomberg.

On Friday, data showed Japanese inflation accelerated more than expected. Consumer prices excluding fresh food rose 3.2% from a year earlier in January, the biggest gain since June 2023. That’s supporting bets for more rate hikes by the BOJ, with traders pricing in a roughly 84% chance of a 25 basis point increase in July.

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