Asian markets opened the week with modest gains on Monday, as investors responded to a mix of upbeat factory data from China and ongoing caution over central bank policy in the United States and Europe. The tone was one of tentative optimism, with key indices rising amid hopes that inflation is stabilising across major economies.
Japan’s Nikkei 225 edged up 0.3% in early trade, buoyed by strength in technology and machinery stocks. The broader Topix also posted small gains, supported by positive PMI figures from China that suggested a recovery in the country’s manufacturing sector. The official Chinese manufacturing PMI came in at 50.5, the highest level since March, fuelling a sense that Beijing’s modest stimulus measures may be gaining traction.
Hong Kong’s Hang Seng Index rose 0.7%, led by gains in property developers and select financials, while the Shanghai Composite added 0.4%. Investors in mainland China remained cautious, however, as weak consumer sentiment and ongoing concerns about youth unemployment tempered enthusiasm.
In South Korea, the KOSPI added 0.2% after data showed industrial output rebounded slightly in May, though analysts noted that semiconductor exports remain fragile. Australia’s ASX 200 traded flat, with losses in energy stocks offsetting gains in mining shares, particularly iron ore producers benefiting from China’s industrial rebound.
Currency markets were largely stable, with the US dollar steady against the yen at around 160.80, its highest level since 1986. The Japanese government has signalled concern about the yen’s depreciation but has not yet intervened directly. Meanwhile, the euro and pound held steady ahead of a week filled with political and economic events, including the French snap parliamentary elections and UK GDP data.
Looking ahead, European markets are expected to open slightly higher as investors digest the latest inflation data from Germany and Spain. The pan-European Stoxx 600 is eyeing a 0.2% rise at the open, with attention turning to the European Central Bank’s stance on rate cuts. Analysts are also watching bond spreads between France and Germany as political uncertainty continues to rattle investors.
In the United States, equity futures point to a cautious start, with S&P 500 and Nasdaq futures flat in early European trade. All eyes will be on Federal Reserve Chair Jerome Powell, who is scheduled to speak later today at a central banking forum in Portugal. His remarks may offer clues on whether the Fed intends to move toward rate cuts later in the year, especially after last week’s cooler-than-expected personal consumption expenditure (PCE) inflation figures.
Markets will also be watching upcoming US labour data, including the JOLTS job openings report and Friday’s non-farm payrolls, for signs of cooling momentum in the jobs market. A softer print could reinforce expectations of a Fed pivot as soon as September, though policymakers have remained cautious about declaring victory over inflation.
Overall, the tone across global markets remains measured but constructive, with investors cautiously optimistic about central banks’ ability to engineer soft landings without triggering recession. Volatility, however, may rise throughout the week as data and political headlines shape expectations.
REFH – newshub finance
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