Asian Markets Rise on Dimmed Fed Rate Hike Prospects
Asian stock markets opened higher on Monday, buoyed by easing inflation concerns that have lowered the chances of another Federal Reserve rate hike. Japan’s Nikkei 225 surged 2.5% to 70,037.61, marking its first climb above 70,000 points in three months. Australia’s S&P/ASX 200 rose slightly by 0.1% to 8,691.90, while Hong Kong’s Hang Seng remained flat at 23,971.55. Trading was closed in Shanghai and South Korea due to national holidays.
Artificial intelligence-related stocks attracted significant buying interest. In Japan, Tokyo Electron and SoftBank Group shares gained 5.5% and 3.3%, respectively, while Taiwan Semiconductor Manufacturing Co. (TSMC) rose by 2.6%. The positive momentum follows a strong performance by U.S. stocks last week, which closed near all-time highs after a subdued jobs report eased inflation worries.
The S&P 500 climbed 0.7%, nearing its August record, while the Dow Jones and Nasdaq gained 0.5% and 1.2%, respectively. The U.S. jobs report showed a net increase of 29,000 jobs, below expectations, signaling a potential pause in Fed rate hikes. This shift calmed the bond market, with the 10-year Treasury yield briefly dipping below 5.17% before recovering to 5.28%.
Energy markets saw declines, with U.S. crude dropping 1.03% to $90.17 per barrel, and Brent crude falling 0.58% to $101.66 amid uncertainty over the Iran conflict’s impact on global oil supplies. In currency trading, the U.S. dollar strengthened slightly against the yen and euro.