Post by : Badri Ariffin

Asian equity markets displayed a mixed bag on Tuesday as traders reacted to the robust performance of US stocks the previous day, spurred by hopes of an impending Federal Reserve interest rate cut.

In Japan, the Nikkei 225 was nearly unchanged, climbing marginally by less than 0.1% to close at 48,644.92 after a holiday. Meanwhile, South Korea's Kospi was stable at around 3,848.00, and Taiwan's Taiex marked a significant rise of 1.4%.

Chinese stocks moved upward, with Hong Kong's Hang Seng index rising by 0.6% to 25,875.36 and the Shanghai Composite gaining 1.1% to 3,880.22. E-commerce titan Alibaba achieved a 2.4% increase ahead of its anticipated earnings report for the day. However, Australia's S&P/ASX index slipped by 0.2% to 8,510.30.

In the US, Monday showcased strong market rallies, even considering the shortened Thanksgiving trading week; the S&P 500 surged by 1.5% to reach 6,705.12, the Dow Jones increased by 0.4% to 46,448.27, and the Nasdaq experienced a notable jump of 2.7% to 22,872.01. Tech and AI stocks were in the lead, with Alphabet skyrocketing 6.3% amid enthusiasm over its Gemini AI model, while Nvidia rose by 2.1%.

Market participants are now keenly observing the Fed's forthcoming decisions, with an 85% probability now attached to a rate cut in December, up from 71% just a week ago. Upcoming US wholesale inflation data, expected to indicate a 2.6% year-on-year rise, could influence this decision; a higher-than-anticipated figure may temper rate cut expectations.

Caution was also reflected in commodity markets, where US crude dropped by 28 cents to $58.56 a barrel and Brent crude declined by 33 cents to $62.39 a barrel. Currency markets saw fluctuations, with the dollar slightly weaker at 156.81 yen, and the euro slipping to $1.1517. Bitcoin also saw a 1.1% retracement to $88,200, a significant fall from nearly $125,000 last month.

Today’s market dynamics present global investors with the challenge of balancing optimism for a more lenient US monetary policy against ongoing inflation concerns, all while closely monitoring the volatile trends in tech and AI sectors.

#Asia News