Asian Stocks Fluctuate After Wall Street Rebound: Markets Wrap

Asian equities fluctuated on Monday after Wall Street snapped a five-day losing streak, helped by fresh demand for big tech stocks.

Shares in Australia gained 0.4%, while Japan’s Topix dropped in its first session after a multiday holiday. US contracts were little changed after the S&P 500 ended Friday up 1.3%, ending a selloff that had wiped more than a trillion dollars from the equity market. 

The dollar was mixed against major currencies early Monday, while the yen gave up some of its gains from late last week to trade around 157 per dollar. The daily fixing for China’s currency is in the spotlight after the onshore yuan breached a key milestone for the first time since late 2023. 

Investors are showing a mixed appetite for risk after declines in the final trading sessions of last year extended into 2025. Expected monetary policy easing and optimism about artificial intelligence may continue to power gains. Still, looming US-China trade tensions risk undermining any rally. Investors also remain on watch for more stimulus measures from Beijing. 

“We expect policymakers to cut interest rates across the vast majority of Asian economies in 2025,” Goldman Sachs Group Inc. analysts including Andrew Tilton wrote in a note. “The key exception will remain Japan, where we expect reflation to be sustained this year and rate hikes to continue.” 

In Asia, tech stocks will be in focus given the moves in New York trading on Friday. Taiwan-listed Hon Hai Precision Industry Co., the assembly partner to Nvidia Corp. and Apple Inc. that’s also known as Foxconn, reported better-than-expected revenue over the weekend. The results are a sign that demand for AI infrastructure remains robust.

Data due Monday includes China Caixin services and composite PMI, Thai inflation and industrial production for Vietnam. Elsewhere, Israel’s central bank will hand down an interest rate decision, while data for release includes German inflation and US factory orders.

In South Korea, a court dismissed an appeal by lawyers of Yoon Suk Yeol against an arrest warrant for the impeached president, according to a local media report Sunday.

In the US, Federal Reserve Governor Lisa Cook will speak at a conference on law and microeconomics at the University of Michigan. Her colleague Tom Barkin, the Richmond Fed President, suggested on Friday his preference was to keep rates restrictive for longer. 

The comments, and data showing the US economy remains strong, underscore the challenge investors face in deciphering the path ahead for US interest rates after Fed Chair Jerome Powell’s hawkish pivot in December.

Investors are also contemplating Donald Trump’s return to the White House in two weeks.

“We really need to see more of that clarity on Jan. 20 for markets to have greater conviction,” Laura Cooper, global investment strategist at Nuveen, said on Bloomberg Television. “US exceptionalism will continue to be the dominant theme at least in the first half of the year, regardless of what some of those policies that come through are.”

Elsewhere, President Joe Biden is set to order a ban on new offshore oil and gas development across some 625 million acres of US coastal territory, ruling out the sale of drilling rights in Atlantic and Pacific waters as well as the eastern Gulf of Mexico.

West Texas Intermediate climbed, extending a rally from last week to trade around $74 per barrel. Gold was little changed at around $2,640 per ounce. 

Key events this week:

• China Caixin services and composite PMI, Monday

• Eurozone HCOB services and composite PMI, Monday

• Germany CPI, Monday

• US factory orders, S&P Global services and composite PMI, Monday

• Fed Governor Lisa Cook speaks, Monday

• Eurozone CPI, unemployment, Tuesday

• US job openings, trade, ISM services, Tuesday

• Richmond Fed President Thomas Barkin speaks, Tuesday

• Eurozone PPI, consumer confidence, Wednesday

• FOMC minutes, Wednesday

• Fed Governor Christopher Waller speaks, Wednesday

• ECB Governing Council member Francois Villeroy de Galhau speaks, Wednesday

• China CPI, PPI, Thursday

• Eurozone retail sales, Thursday

• BOE Deputy Governor Sarah Breeden speaks, Thursday

• Japan household spending, leading index, Friday

• US nonfarm payrolls, unemployment, University of Michigan consumer sentiment, Friday

Some of the main moves in markets:

• S&P 500 futures were little changed as of 9:01 a.m. Tokyo time

• Japan’s Topix rose 0.3%

• Australia’s S&P/ASX 200 rose 0.4%

• Euro Stoxx 50 futures fell 0.9%

• The Bloomberg Dollar Spot Index was little changed

• The euro was little changed at $1.0304

• The Japanese yen fell 0.2% to 157.53 per dollar

• The offshore yuan was little changed at 7.3604 per dollar

• Bitcoin was little changed at $98,508.15

• Ether fell 0.1% to $3,641.4

• The yield on 10-year Treasuries advanced two basis points to 4.62%

• Australia’s 10-year yield advanced six basis points to 4.44%

• West Texas Intermediate crude rose 0.3% to $74.18 a barrel

• Spot gold was little changed