Asian Stocks Gain On US Bounce, China Optimism: Markets Wrap

Asian stocks climbed, buoyed by renewed optimism over China's economy and US data that eased recession concerns.  

Japanese equity benchmarks outperformed with gains topping 1%, while shares in Australia and South Korea also advanced. Futures showed Hong Kong's benchmark may open more than 2% higher on Tuesday. That's after US stocks climbed for a second day, as industrial and energy shares rallied.

While the latest economic data did little to alter traders' bets on the Federal Reserve outlook, mixed retail sales brought some relief that US consumer spending is not collapsing. An overnight rally in Chinese tech giants listed in New York has set a positive tone for Asia trading, following a Monday afternoon briefing by Beijing on bolstering consumption. 

The S&P 500 and the Nasdaq 100 rose about 0.6% each on Monday, as gains in small-cap stocks outweighed a slide in the Magnificent Seven cohort.  

“Corrections that occur within a bull market tend to be good buying opportunities,” said David Lefkowitz at UBS Global Wealth Management. “The spike in policy uncertainty hit the market at a time when investor positioning and sentiment were quite elevated. But we think a lot of this has now been cleaned up.”

The yield on 10-year Treasuries was little changed after slipping one basis point to 4.30% on Monday. The Bloomberg Dollar Spot Index was steady.

In Japan, shares of the biggest trading houses rallied after Berkshire Hathaway Inc. increased its stake. 

The Bank of Japan is expected to keep the policy rate at 0.5% at Wednesday's conclusion of a two-day gathering, according to economists surveyed by Bloomberg. A key focus for Governor Kazuo Ueda and his fellow board members will be mounting concerns over global economic prospects due to escalating trade tensions. 

“The BOJ must be closely watching steep gains in yields,” said Junki Iwahashi, senior economist at Sumitomo Mitsui Trust Bank. “So close attention will be warranted on Ueda's comments about that when he speaks at the briefing.”

Back in China, stock investors are turning their attention to upcoming tech earnings including from Xiaomi Corp. on Tuesday. The nation's equities have outperformed global markets this year, thanks to a rally in tech shares driven by the DeepSeek artificial-intelligence model. BYD Co. unveiled a new system for electric cars that it says will allow them to charge almost as fast as it takes a regular car to refuel.

Retail Sales

US retail sales rose by less than forecast in February and the prior month was revised lower. However, the so-called control-group sales — which feed into the government's calculation of goods spending for gross domestic product — increased 1% last month, reversing the previous drop..

A sense of wait-and-see may emerge from policymakers this week, in their first assessment of how Trump's trade policies are impacting the economy. With Fed officials expected to hold rates steady on Wednesday, the market will focus on officials' updated economic projections and Chair Jerome Powell's press conference for clues on the path ahead.

Meanwhile, oil steadied after a two-day gain, with the outlook for China's economy and geopolitical risk in the Middle East remaining in focus. Gold hovered near $3,000 an ounce. 

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Key events this week:

• US housing starts, import price index, industrial production, Tuesday

• Bank of Japan rate decision, Wednesday

• Federal Reserve rate decision, Wednesday

• China loan prime rates, Thursday

• Bank of England rate decision, Thursday

• US Philadelphia Fed factory index, jobless claims, existing home sales, Thursday

• Eurozone consumer confidence, Friday

• Fed's John Williams speaks, Friday

Some of the main moves in markets:

Stocks

• S&P 500 futures were little changed as of 9:20 a.m. Tokyo time

• Hang Seng futures rose 2.1%

• Japan's Topix rose 1.3%

• Australia's S&P/ASX 200 rose 0.6%

• Euro Stoxx 50 futures rose 0.4%

Currencies

• The Bloomberg Dollar Spot Index was little changed

• The euro was little changed at $1.0920

• The Japanese yen was little changed at 149.29 per dollar

• The offshore yuan was little changed at 7.2281 per dollar

Cryptocurrencies

• Bitcoin was little changed at $83,947.51

• Ether fell 0.3% to $1,928.9

Bonds

• The yield on 10-year Treasuries was little changed at 4.29%

• Japan's 10-year yield declined one basis point to 1.505%

• Australia's 10-year yield declined one basis point to 4.39%

Commodities

• West Texas Intermediate crude fell 0.2% to $67.47 a barrel

• Spot gold was little changed