Most Asian stocks rose on Monday as technology shares rebounded from steep losses logged last week, although investors remained cautious before central bank meetings in Australia and India this week.
Japanese shares lagged as strength in the yen pressured export-oriented stocks, while Indian markets nursed outsized losses from last week.
Regional markets tracked some strength in Wall Street from Friday, where in-line inflation data helped traders maintain expectations for more interest rate cuts by the Federal Reserve. But sentiment towards U.S. markets was dented by fears of a looming government shutdown, which could occur later this week, while a flurry of more tariff announcements also weighed.
S&P 500 Futures rose 0.3% in Asian trade.
Australian stocks upbeat ahead of RBA Australia’s ASX 200 index rose 0.8% with focus chiefly on the conclusion of a two-day Reserve Bank of Australia meeting on Tuesday. Banks and gold stocks were the main boosts to the index.
The RBA is widely expected to keep interest rates unchanged amid recent signs of inflation turning sticky, but could offer up some signals on a potential cut in November.
“A 25bp cut is more likely in November, taking the policy rate to 3.35% for an extended period,” ANZ analysts said in a recent note, adding that Governor Michele Bullock was widely expected to reiterate the central bank’s data-driven stance on further easing, after about 75 bps of cuts so far in 2025. Recent data showing an unexpected increase in Australian inflation had dampened bets on more rate hikes by the RBA, which has maintained its stance of curbing inflation as a key goal.
Asia tech leads gains after steep losses; Japan lags South Korea’s KOSPI and Hong Kong’s Hang Seng index were the top performers in Asia, rallying 1.1% and 1.5%, respectively.
Regional tech shares rebounded after logging steep losses last week on some doubts over the artificial intelligence trade. Reports that the U.S. was mulling even more measures against imported semiconductors also rattled the sector.
South Korean chipmaker SK Hynix Inc (KS:000660) rallied 3.7% and was among the top boosts to the KOSPI, as it rebounded from steep losses seen last week.
In Hong Kong, BYD Co (HK:1211) rose 1.5% after local media reported the electric vehicle maker expects exports to account for about 20% of its global sales in 2025, as it pushes for international expansion to offset weakening domestic sales.
Tech was aided by a drop in Treasury yields, especially as U.S. PCE price index data on Friday read in line with expectations. The print drummed up bets on more interest rate cuts from the Fed, supporting Wall Street and also supporting risk into Monday’s Asian session.
Broader Asian markets also mostly advanced. China’s Shanghai Shenzhen CSI 300 and Shanghai Composite indexes rose 0.6% and 0.1%, respectively.
