Asian Markets Track Global Markets Higher

Asian stock markets are trading mostly higher on Monday, following the broadly positive cues from global markets on Friday, amid bets the US Fed will likely cut interest rate in June after data showed a slowdown in manufacturing activity and a drop in consumer sentiment in the U.S. Traders also react to a slew of economic data from the region. Asian markets closed mostly higher on Friday.

The Australian stock market is currently trading modestly lower on Monday after opening in the green, giving up the gains in the previous two sessions, with the benchmark S&P/ASX 200 staying above the 7,700.00 level at fresh all-time highs, despite the broadly positive cues from global markets on Friday, as traders react to a couple of economic data on company operating profits and building approvals.

The benchmark S&P/ASX 200 Index is losing 12.70 points or 0.16 percent to 7,732.90, after touching a fresh all-time high of 7,769.10 earlier. The broader All Ordinaries Index is down 12.80 points or 0.16 percent to 7,994.30. Australian stocks closed notably higher on Friday.

Among the major miners, Rio Tinto and Fortescue Metals are edging down 0.3 to 0.4 percent each, while BHP Group is losing almost 1 percent. Mineral Resources is gaining almost 1 percent.

Oil stocks are mixed. Beach energy and Santos are gaining almost 1 percent each, while Origin Energy and Woodside Energy are losing almost 1 percent each.

Among tech stocks, Xero is gaining more than 1 percent, Appen is surging more than 5 percent, Zip is adding almost 4 percent and WiseTech Global is up almost 2 percent, while Afterpay owner Block is edging down 0.1 percent.

Gold miners are higher. Gold Road Resources is surging 6.5 percent, Northern Star Resources is advancing almost 6 percent, Evolution Mining is gaining more than 5 percent, Newmont is adding more than 1 percent and Resolute Mining is rising more than 4 percent.

Among the big four banks, Commonwealth Bank is gaining almost 1 percent, while Westpac, ANZ Banking and National Australia Bank are edging up 0.4 to 0.5 percent each.

In economic news, the total number of building approvals issued in Australia in January was down a seasonally adjusted 1.0 percent on month – coming in at 12,850. That missed forecasts for an increase of 4.0 percent following the 9.5 percent drop in December. The value of new residential building rose 19.4 percent to A$7.14 billion, while the value of non-residential building climbed 12.4 percent to A$4.92 billion.

Meanwhile, company operating profits in Australia were up a seasonally adjusted 7.4 percent in quarter in the fourth quarter of 2023, the Australian Bureau of Statistics said on Monday. That beat forecasts for an increase of 1.8 percent following the 1.3 percent decline in the three months prior. Profits were down 5.4 percent on year.

In the currency market, the Aussie dollar is trading at $0.653 on Monday.

The Japanese stock market is trading significantly higher on Monday, extending the gains in the previous session. The benchmark S&P/ASX 200 is moving to near the 40,200 level to fresh all-time highs, following the broadly positive cues from global markets on Friday, with gains in index heavyweights and technology stocks.

The benchmark Nikkei 225 Index closed the morning session at 40,226.83, up 316.01 points or 0.79 percent, after touching an all-time high of 40,314.64 earlier. Japanese shares ended sharply higher on Friday.

Market heavyweight SoftBank Group is gaining almost 1 percent, while Uniqlo operator Fast Retailing is edging down 0.2 percent. Among automakers, Honda is edging up 0.3 percent, while Toyota is losing almost 1 percent.

In the tech space, Screen Holdings is gaining almost 1 percent, Advantest is advancing more than 3 percent and Tokyo Electron is up more than 2 percent.

In the banking sector, Sumitomo Mitsui Financial is edging up 0.1 percent, while Mitsubishi UFJ Financial is down 0.2 percent. Mizuho Financial is flat.

The major exporters are higher. Canon is gaining more than 1 percent, while Panasonic, Sony and Mitsubishi Electric are losing almost 1 percent each.

Among other major gainers, Olympus and Isetan Mitsukoshi are surging more than 5 percent each, while Renesas Electronics is gaining almost 5 percent. Rakuten Group is up more than 4 percent, while Sumco and CyberAgent are advancing almost 4 percent each. Mitsui Fudosan and Lasertec are up more than 3 percent each, while Keyence, Pacific Metals, Japan Exchange Group, Chugai Pharmaceutical and Yaskawa Electric are adding almost 3 percent each.

Conversely, Kawasaki Kisen Kaisha is losing almost 6 percent, DeNA is declining almost 5 percent and Aozora Bank is down more than 4 percent.

In economic news, the monetary base in Japan was up 2.4 percent on year in February, the Bank of Japan said on Monday – coming in at 661.668 trillion yen. That was shy of expectations for an increase of 4.7 percent and down from the upwardly revisted 4.8 percent gain in January (originally 4.7 percent). The adjusted monetary base slumped 7.6 percent at 668.572 trillion yen.

In the currency market, the U.S. dollar is trading in the lower 150 yen-range on Monday.

Elsewhere in Asia, Taiwan and South Korea are up 2.1 and 1.2 percent, respectively. China, Hong Kong, Malaysia and Indonesia are up 0.1 and 0.5 percent each. New Zealand and Singapore are down 0.2 and 0.4 percent, respectively.

On Wall Street, stocks showed a strong move to the upside during trading on Friday, adding to the gains posted in Thursday’s session. With the extended upward move, the Nasdaq and S&P 500 once again reached new record closing highs.

The tech-heavy Nasdaq jumped 183.02 points or 1.1 percent to 16,274.94 and the S&P 500 climbed 40.81 points or 0.8 percent to 5,137.08. The narrower Dow posted a more modest gain, rising 90.99 points or 0.2 percent to 39,087.38.

The major European markets also moved to the upside on the day. While the U.K.’s FTSE 100 Index advanced by 0.7 percent, the German DAX Index rose by 0.3 percent and the French CAC 40 Index inched up by 0.1 percent.

Crude oil prices rose to a four-month high on Friday, buoyed by reports that oil demand surged to a four-year high in 2023 and will hold near that level again this year. West Texas Intermediate Crude oil futures for April spiked $1.71 or 2.2 percent at $79.97 a barrel, the highest close since November 6, 2023.