Asian Stocks Poised to Track Wall Street Rally: Markets Wrap
Asian stocks were mostly set to follow Wall Street higher after a fresh wave of dip buying drove the ’s biggest rally since May.
Equity futures pointed to gains in Tokyo and Sydney, tracking US optimism as traders weighed strong earnings against rising hopes for a Federal Reserve rate cut. Sentiment in Hong Kong was more subdued.
The climbed 1.5% on Monday, with almost every major group in the benchmark index advancing. led gains, rebounding from recent selling pressure, with and each surging at least 3.5%.
Morgan Stanley’s Michael Wilson said investors should into the recent selloff, citing a strong earnings outlook. At Goldman Sachs Group Inc., David Kostin noted executives have so far expressed confidence in managing tariff risks.
S&P 500 earnings are crushing second-quarter expectations — up 9.1%, triple the pre-season forecast and the strongest beat rate since 2021, according to data compiled by Bloomberg Intelligence .
“This week is a quiet one on the economic calendar, so traders may be taking their cues from earnings, along with any new tariff and trade developments,” said Chris Larkin at E*Trade from Morgan Stanley.
Larkin also noted that a key question now is whether traders will view any signs of economic weakness as a market negative, or as a catalyst for the Fed to cut rates sooner rather than later.
Action in the bond market was fairly muted as the US is set to auction $125 billion of new three-, 10- and 30-year debt this week. The was little changed. fell as traders took stock of OPEC+’s latest bumper supply increase while President Donald Trump vowed to penalize India for buying Russian crude.
Beijing is bracing for more heavy rain just a week after deadly floods killed at least 44 people. Some areas could see over 200 millimeters (7.9 inches) in six hours, raising landslide risks, forecasters warned Monday. Hong Kong’s observatory also issued a rain alert for Tuesday.
Meanwhile, ’s Shanghai factory slipped back into decline on intense competition in China and global trade uncertainties. Chief Executive Officer Elon Musk was approved by the company to receive an worth about $30 billion.
On the tariff front, the is expecting Trump to announce executive actions this week to formalize the bloc’s lower levies for cars and grant exemptions from levies for some industrial goods such as aviation parts, according to people familiar with the matter. Meanwhile, the Swiss government said it is determined to after last week’s shock announcement of 39% levies on exports to America.
“Our base case remains that US tariffs will eventually settle around 15%. While this would be the highest since the 1930s, and six times higher than when Trump returned to office, we do not expect it to cause a recession or end the equity bull market,” said Ulrike Hoffmann-Burchardi at UBS Global Wealth Management.
“However, in the near term, the ‘handshake’ nature of trade deals agreed so far means that tensions could resurface as the details are negotiated,” she noted.
Some of the main moves in markets:
Stocks
Currencies
Cryptocurrencies
Bonds
Commodities
