^{Photo: Business Standard}

Asian equities climbed on Monday, extending Wall Street’s late-week momentum after Federal Reserve Chair Jerome Powell hinted at the possibility of an interest rate cut as early as next month. Powell’s comments, delivered at the Federal Reserve’s annual Jackson Hole symposium in Wyoming, reassured markets that the central bank is prepared to ease policy if inflation continues to cool.

South Korea Leads Regional Gains

In South Korea, the Kospi index rose 0.67%, buoyed by gains in major technology and financial stocks. The Kosdaq, which tracks smaller-cap companies, outperformed with a 1.91% surge, reflecting renewed investor appetite for growth sectors.

The rally follows stronger-than-expected earnings from domestic chipmakers and optimism around global demand for semiconductors — a sector that represents more than 20% of South Korea’s exports.

Japan and Australia Follow Wall Street Higher

Japanese equities also participated in the upswing. The Nikkei 225 climbed 0.69%, while the broader Topix index advanced 0.27%, supported by automakers and electronics manufacturers. Investors remain optimistic that a weaker yen will continue to boost Japan’s export competitiveness.

In Australia, the S&P/ASX 200 rose 0.27%, paring earlier gains after briefly crossing the 9,000-point milestone for the first time in its history during morning trade. Mining and energy stocks were key drivers, reflecting stronger commodity prices and global demand outlooks.

Chinese and Hong Kong Markets Extend Momentum

On the Chinese mainland, the CSI 300 index gained 1.39%, powered by advances in consumer discretionary and new energy shares. The move reflects growing confidence that Beijing’s recent economic support measures — including tax cuts and stimulus for the property sector — may stabilize growth in the second half of the year.

Meanwhile, Hong Kong’s Hang Seng Index advanced 1.21%, with technology and property developers leading the way. Foreign investors also increased allocations to Hong Kong-listed stocks, encouraged by stronger liquidity conditions and expectations of easier monetary policy in China.

Investors Await Key Data from Singapore

Elsewhere in the region, markets turned their attention to Singapore, where the July Consumer Price Index (CPI) is due for release. Economists polled by Reuters forecast a 0.6% year-over-year rise, in line with June’s pace. A stable reading would reinforce the view that inflationary pressures in Southeast Asia are moderating, allowing policymakers to maintain a cautious stance on monetary tightening.

Wall Street’s Rally Provides Tailwind

Friday’s surge on Wall Street provided much of the fuel for Asia’s positive start to the week:

• The Dow Jones Industrial Average soared 846.24 points (1.89%) to a record close at 45,631.74.
• The S&P 500 gained 1.52% to 6,466.91, just shy of its all-time high.
• The Nasdaq Composite jumped 1.88% to 21,496.53, lifted by strength in mega-cap technology stocks.

Market participants are now looking ahead to Nvidia’s earnings report, expected later this week, which could serve as a bellwether for the broader technology sector and AI-related investments.

Outlook

With Asia tracking Wall Street’s gains and expectations for Fed easing gaining traction, investor sentiment remains upbeat. However, analysts caution that upcoming data — including U.S. inflation figures, China’s economic indicators, and Singapore’s CPI reading — will be critical in shaping short-term market direction.

For now, optimism about lower borrowing costs, resilient corporate earnings, and easing inflationary pressures is fueling a broad-based rally across global equity markets.

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