Asian stock markets are trading mostly higher on Monday, buoyed by positive cues from Wall Street on Friday and renewed optimism about potential interest rate cuts.
However, traders remain cautious ahead of US President-elect Donald Trump’s inauguration, with uncertainties surrounding his potential policies.
Nikkei regains 39,000
The Japanese market is sharply higher, with the Nikkei 225 Index rising 1.29% to 38,948.47, supported by broad-based gains across sectors.
The index hit an intraday high of 39,032.93.
Technology stocks such as Advantest and Tokyo Electron are up over 1%, while Screen Holdings surged nearly 5%.
In the financial sector, Mitsubishi UFJ Financial and Mizuho Financial gained over 2% each.
Daiichi Sankyo shares jumped over 6% following the US FDA’s approval of a breast cancer drug developed in collaboration with AstraZeneca.
In economic news, Japan reported a 3.4% month-on-month increase in core machinery orders for November, beating expectations of a decline.
This marked a 10.3% year-on-year increase, signaling resilience in corporate investment despite broader economic uncertainties.
Hong Kong, China stocks rally on hopes better US relations
Hong Kong stocks surged following a positive phone call between Chinese President Xi Jinping and US president-elect Donald Trump.
The Hang Seng Index rose 2%, while the Hang Seng Tech Index climbed 2.6%.
China’s CSI 300 Index gained 0.8% and the Shanghai Composite Index increased by 0.4%.
Leading the rally was e-commerce giant JD.com, which jumped 5.6%, followed by Alibaba Group Holding, which rose 5% and tech giant Baidu, which advanced over 3%.
During their phone call on Friday, Xi and Trump discussed major issues, including the crisis in Ukraine, the Israel-Palestine conflict, and the US Supreme Court’s ban on TikTok.
Other regional markets
In Australia, the S&P/ASX 200 Index is up 0.18% at 8,325.50, recovering from losses in the previous session. Gains are led by iron ore miners and technology stocks, while gold miners weigh on the index.
Among major miners, BHP Group and Rio Tinto are posting gains, while Fortescue Metals and Mineral Resources are slightly lower.
South Korea’s Kospi gave up early gains to trade largely flat in the late hours of trading on Monday.
The index was 0.079% to trade at 2,525.54.
Wall Street ends strong on Friday
US stocks experienced a strong rally on Friday, with major indices recovering from the losses seen in the previous session. The upward movement led the Dow to close at its highest level in a month.
Although the major averages pulled back slightly from their best levels in the latter part of the session, they remained solidly in the green.
The Nasdaq surged 291.91 points, or 1.5%, to 19,630.20, the S&P 500 rose 59.32 points, or 1.0%, to 5,996.66, and the Dow gained 334.70 points, or 0.8%, to 43,487.83.
The major averages also posted strong weekly gains, with the Dow rising 3.7%, the S&P 500 up 2.9%, and the Nasdaq advancing 2.5%.
The rally may have been fueled by a recent decline in Treasury yields, although the yield on the benchmark ten-year note recovered from an early drop to end the day roughly flat.
The pullback in Treasury yields followed recent US inflation data that sparked renewed optimism about the outlook for interest rates.
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