Asian stocks rise as US data boosts interest rate cut hopes

Asian Stocks Extend Global Rally As Data Boost Rate Cut Hopes

The Asian stock market has extended a global equities rally after a recent round of US data reinforced expectations that the Federal Reserve will cut interest rates again next month. A report that US President Donald Trump’s top economic aide, Kevin Hassett, is the frontrunner to be the central bank’s next boss, has added to the risk-on mood, with investors regaining confidence after a recent stutter.

The US data, which included a slowdown in retail sales and a drop in consumer confidence, has led to increased bets that the Federal Reserve will lower borrowing costs at its December meeting. The Labor Department’s report on wholesale inflation, which showed a pickup in September, was in line with forecasts, but the rise was driven by a big jump in goods prices, highlighting the steeper costs that businesses face.

Analysts have expressed concern about the reading, particularly ahead of the holiday spending period. The Conference Board’s consumer confidence index dropped to its lowest level in seven months, with shoppers expressing greater worry about labor market conditions and the outlook for household incomes.

The chances of a more dovish Fed have been boosted by the potential appointment of Hassett, who is seen as closely aligned with President Trump’s preference for lower interest rates. The appointment would likely reinforce the administration’s push for easier policy, according to National Australia Bank’s Rodrigo Catril.

The Asian market has followed Wall Street’s lead, with Tokyo and Seoul gaining around two percent, while Hong Kong, Shanghai, Sydney, Singapore, Taipei, and Wellington also recording healthy advances. The gains come after a pullback on trading floors for much of November, owing to worries about lofty valuations, particularly among tech firms.

In corporate news, Chinese e-commerce titan Alibaba dropped more than one percent after reporting a fall in profit linked to consumer subsidies and the building of data centers to deal with its AI ambitions. The company’s performance has raised questions about the wisdom of the vast sums of cash invested in the artificial intelligence sector.

Key figures at around 0230 GMT include the Tokyo Nikkei 225, which was up 1.9 percent at 49,605.57, and the Hong Kong Hang Seng Index, which was up 0.6 percent at 26,054.70. The euro was up against the dollar, while the pound was also up against the dollar. The dollar was down against the yen, and the euro was down against the pound. West Texas Intermediate and Brent North Sea Crude were both up, with the former at $58.06 per barrel and the latter at $62.62 per barrel.

The global rally is expected to continue, with investors closely watching the Federal Reserve’s next move and the potential impact on the global economy. The appointment of a new Fed boss and the upcoming holiday spending period are also likely to be key factors in determining the market’s direction.