Asian markets are poised for a positive opening on Monday, fueled by a series of crucial economic data releases and policy decisions across the region. This comes in the wake of an impressive rally on Wall Street, driven by U.S. job growth figures that exceeded expectations.
Key events on the Asian economic calendar include Japan's trade and current account data, Malaysia's industrial production figures, and an interest rate decision from the Philippines. These developments are keenly awaited by investors looking to gauge the health of the regional economy.
Following a challenging Friday that saw a 2% drop, Japan's Nikkei 225 index aims for recovery. Last week's decline was its most significant since December 2022, highlighting the impact of exchange rate fluctuations and potential market interventions by Tokyo on investor sentiment.
Friday's rebound in U.S. markets was particularly notable, occurring despite an uptick in bond yields, a 4% weekly increase in oil prices, and diminishing expectations for U.S. interest rate cuts. Additionally, geopolitical tensions have escalated, pushing gold prices to a new high.
Whether the positive momentum from Wall Street will carry over to Asian markets remains to be seen. However, current indicators suggest a period of market consolidation rather than a sell-off, despite the S&P 500 and MSCI World indexes experiencing their largest weekly losses in three months due to rising bond yields.
The resilience of the MSCI Asia ex-Japan index, which remained stable despite higher U.S. yields, can be attributed to encouraging economic data from China. With Beijing set to release important indicators, including lending, trade, and inflation data, investors are watching closely.
During a recent visit to China, U.S. Treasury Secretary Janet Yellen discussed initiatives for "balanced" economic growth with Chinese officials, aiming to address concerns over China's manufacturing capacity. These discussions are part of broader efforts to stabilize bilateral relations through open dialogue.
The Philippine central bank is expected to maintain its key policy rate at 6.50%, marking the fourth consecutive meeting without a change. This decision comes as inflation rates begin to climb, prompting caution from the central bank regarding future economic risks.
Monday's market direction will be influenced by several key developments, including the policy meeting of the Philippines central bank, Japan's trade and current account data, and Malaysia's industrial production figures.
