Wall Street Hits Record, What's the Impact on Asia?
Asian stocks are expected to open with slight gains on Tuesday, following a rally on Wall Street driven by renewed optimism for big tech stocks. Futures for Australia and South Korea point to potential gains, while Hong Kong is likely flat due to the strongest typhoon since 2018. The US bond market is closed for a national holiday in Japan, resulting in quieter trading in Asia.
On Wall Street, the S&P 500 notched its 28th record this year after Nvidia shares jumped about 4% following its commitment to invest up to $100 billion in OpenAI. The tech rally has pushed US stocks up for three straight weeks, boosted by positive sentiment from the Fed's first interest rate cut this year. However, some analysts are warning investors to remain cautious amid the massive rally that has added about $15 trillion to market value since April.
The bond market is relatively calm, with US yields slightly higher ahead of Treasury auctions and the release of key inflation data. The Fed's preferred inflation gauge, the core PCE index, is expected to grow more slowly in August, giving the central bank more room to focus on the weakening labor market. Several Fed officials will deliver their views this week, including Chairman Jerome Powell, while Governor Stephen Miran has called for more aggressive interest rate cuts.
In Asia-Pacific, attention is also focused on New Zealand, which will appoint its first female central bank governor and a foreigner to lead the institution. Meanwhile, Hong Kong is bracing for super typhoon Ragasa, which could delay the trading debut of giant Zijin Gold International's IPO, one of the largest public offerings in recent months. (ads)
Source: Bloomberg.com
