Asian stock markets went up after China promised to take new steps to boost spending. Meanwhile, US stock futures fell a bit after Treasury Secretary Scott Bessent said the recent market drop is normal. On Monday morning, stocks in Australia, Japan, and South Korea were doing well, and Hong Kong futures showed signs of a rise, too. This followed a strong Friday when the S&P 500 rose by 2.1% as the government avoided a shutdown, and the tech-focused Nasdaq 100 also jumped 2.1%. The Golden Dragon index, which tracks Chinese stocks, increased by 2.7% because Chinese authorities are set to announce measures to encourage spending.
The market is keeping a close watch on China after Xinhua reported that leaders will share plans to stabilize the stock and real estate markets and help boost wages and the birth rate. Key Chinese data, like factory output and retail sales for February, will be released on Monday and closely examined. Tony Sycamore, an analyst, said that these new initiatives should lift the spirits of Chinese consumers, which might support a global stock market rally that began on Friday.
In Asia, US Treasury bonds ticked up slightly after their drop on Friday, as stock futures in the US went down. The yield on the benchmark 10-year Treasury note slipped to 4.30% following a rise the previous day.
Investors are also keeping an eye on upcoming central bank meetings this week as trade tensions continue. The Bank of Japan is expected to keep its interest rates steady after raising them last month, while the Bank of England also looks set to maintain its position. Federal Reserve Chairman Jerome Powell has the tough job of reassuring investors that the economy is strong but ready to help if needed.
Economists are keen to see the updated economic forecasts from the Fed, which might lower growth estimates and slightly raise inflation predictions. However, changes to the “dot plot,” which shows Fed members’ rate predictions, might not happen if they believe the rise in inflation will be temporary.
On a separate note, German Chancellor-in-waiting Friedrich Merz announced a deal with the Green party for a debt-funded defense and infrastructure plan. The euro has strengthened for two weeks and is near its highest value against the dollar since November, ahead of a key vote on this plan set for Tuesday.
In the commodities market, oil prices rose for the second straight day thanks to China’s stimulus plans, while gold prices edged up after a slight dip on Friday, ending a four-day winning streak amid shifting market moods.
Leave a Reply