A Report by CYS Global Remit Counterparty Sales & Alliance Unit
Following the S&P 500's record high close, Asian markets have mostly mirrored this positive sentiment. The Nikkei 225 in Japan increased by 1.65%, Australia's ASX 200 by 0.88%, and South Korea's KOSPI by 0.17%. However, momentum in Chinese equities remains subdued amidst fiscal policy uncertainties. As the week unfolds, corporate earnings and key economic data like US retail sales will play pivotal roles in influencing market sentiment.
Nikkei 225: Boosted by a Weaker Yen
The Nikkei 225 benefits from a weakened yen, driven by Japan's gradual policy approach, boosting the earnings of Japanese exporters. The Bank of Japan is expected to maintain its current policies, providing temporary support for the yen. Technically, the Nikkei is in an upward trend, with potential for further gains.
Hang Seng Index: Awaiting Fiscal Clarity
In Hong Kong, the Hang Seng Index investors are in a wait-and-see mode due to uncertainty around China's fiscal policies. A decisive move is unlikely before the US elections, contributing to a consolidation phase within the 20,400 to 21,600 range. Nonetheless, recent technical breakthroughs offer signs of potential recovery.
Straits Times Index: Resilient Performance
Singapore's Straits Times Index shows resilience, driven by robust dividend yields and positive market dynamics. Efforts to attract high-quality listings and increase liquidity are ongoing. A breakout above 3,650 could push the index towards its 3,900-record high, while any pullback will be scrutinized for higher lows.
Conclusion
The S&P 500’s highs influenced varied trajectories across Asian indices, shaped by their economic and policy contexts. The Nikkei 225 benefits from currency conditions, the Hang Seng faces fiscal uncertainties, and the Straits Times Index demonstrates resilience. Monitoring corporate earnings and economic data will be key as markets navigate shifting global dynamics.
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