Asian markets posted a mixed performance on Monday as investors reassessed their positions after last week’s rally, which was sparked by the Federal Reserve’s decision to cut interest rates. The Tokyo market led the gains after the Bank of Japan clarified its plan to gradually sell off its large holdings of exchange‑traded funds (ETFs). These ETFs had been bought during a monetary‑easing campaign aimed at reviving Japan’s sluggish economy. The initial announcement of the off‑load triggered a sharp decline in the Nikkei on Friday, but officials later said the sales would proceed at a steady pace over roughly 100 years, easing concerns and prompting a market rebound.
Investors also drew encouragement from recent talks between U.S. President Donald Trump and Chinese leader Xi Jinping, which the president described as “making progress on many very important issues.” The discussions touched on a possible deal for the sale of the social‑media app TikTok, and Trump announced plans to meet Xi on the sidelines of the Asia‑Pacific Economic Cooperation summit in South Korea next month, with a further visit to China slated for the following year. Ray Attrill of National Australia Bank noted that, while the talks may have lacked substantive detail, they helped create a positive atmosphere that could extend the current U.S.–China détente.
The broader equity rally has been driven by optimism that the U.S. central bank will continue lowering borrowing costs, as worries about a weakening labor market outweigh persistent inflation. Tokyo stood out, rising more than 1% after the Bank of Japan’s clarification. Gains were also recorded in Shanghai, Sydney, Seoul, Singapore and Taipei, while Hong Kong, Wellington, Manila and Jakarta slipped.
The mixed performance followed another record‑breaking day on Wall Street. At around 02:30 GMT, the Tokyo Nikkei 225 was up 1.5% at 45,729.33, while the Hong Kong Hang Seng Index fell 0.8% to 26,344.78. The Shanghai Composite edged up 0.1% to 3,822.08. The euro/dollar rate slipped to $1.1729 from $1.1745 on Friday, the dollar/yen rose to 148.33 from 147.90, and West Texas Intermediate crude oil gained 0.5% to $63.02 a barrel.
These fluctuations underscore the ongoing uncertainty and caution among investors, who are closely monitoring developments and adjusting their positions. As the global economic landscape evolves, market participants will watch for signs of stability and growth, particularly in the wake of the Federal Reserve’s rate cut and the continuing U.S.–China trade negotiations.
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