FX.co ★ Asian Markets Track Global Markets Higher

Asian stock markets are performing strongly, taking cues from the positive global market activity seen on Friday. The optimism stems primarily from expectations that the US Federal Reserve will reduce interest rates in June, following data indicating a decrease in manufacturing activity and consumer sentiment in the US. The Asian market response also reflects multiple sets of recent economic data from the region.

Australian stocks initially opened in positive territory on Monday but amended course and saw modest losses. Despite this, the benchmark S&P/ASX 200 index has been holding firm above the 7,700-point mark, reaching fresh all-time highs. The dip in stocks occurred despite positive global market trends, as traders factored in recent economic data on corporate operating profits and building approvals.

Major mining corporations, Rio Tinto and Fortescue Metals, saw marginal declines, while fellow miner BHP Group's stocks fell by almost 1%. On the other hand, Mineral Resources saw nearly a 1% increase.

In the oil sector, Beach Energy and Santos experienced moderate gains, while Origin Energy and Woodside Energy each saw losses of nearly 1%. Among tech stocks, Xero, Appen, Zip, and WiseTech Global all witnessed gains, while Afterpay's parent company, Block, reported a slight dip.

Gold mining stocks reported a sizable increase. Among them, Gold Road Resources experienced an increase of 6.5%, and Northern Star Resources saw gains of nearly 6%. Evolution Mining and Newmont also reported strong gains.

Among the largest four Australian banks, the Commonwealth Bank saw nearly a 1% increase, while stocks in Westpac, ANZ Banking, and National Australia Bank each edged up by approximately half a percent.

In terms of economic updates, Australian building approvals saw a seasonally adjusted 1% decrease in January, missing the expected 4% increase following a substantial drop in December. On a brighter note, the total value of new residential and non-residential building rose by 19.4% and 12.4%, respectively.

Elsewhere, company operating profits for Q4 of 2023 exceeded expectations, with a seasonally adjusted 7.4% increase. However, annual profits were down 5.4%.

The Japanese stock market enjoyed a significant rise on Monday, building on gains achieved in the previous trading session. Again, the key S&P/ASX 200 index surged towards an all-time high of over 40,200 points, bolstered by strong performances from heavyweight and tech companies alike.

In the tech sector, Screen Holdings, Advantest, and Tokyo Electron all saw substantial gains. However, major exporters such as Canon, Panasonic, Sony, and Mitsubishi Electric all recorded losses of approximately 1%.

Overall, the Asian markets exhibited resilience and a positive trajectory, navigated by a mixture of global market trends and domestic economic data.In recent economic developments, the Bank of Japan reported a 2.4 percent annual increase in the country's monetary base for February. This figure, amounting to 661.668 trillion yen, fell short of the projected increase of 4.7 percent, and was lower than January's revised boost of 4.8 percent. The adjusted monetary base dropped 7.6 percent, totaling 668.572 trillion yen.

As for foreign exchange, the U.S. dollar hovered around the lower 150 yen-range on Monday.

In other regions of Asia, Taiwan and South Korea witnessed growth rates of 2.1 and 1.2 percent respectively. In comparison, China, Hong Kong, Malaysia, and Indonesia saw more modest increases of between 0.1 and 0.5 percent. Meanwhile, New Zealand and Singapore's economies contracted by 0.2 and 0.4 percent respectively.

On Wall Street, stocks saw substantial growth on Friday, building on the gains from Thursday's trade. This further growth led Nasdaq and the S&P 500 to once again hit record closing highs. Nasdaq surged 183.02 points or 1.1 percent to reach 16,274.94, while the S&P 500 ascended 40.81 points or 0.8 percent, settling at 5,137.08. The Dow saw more moderate growth, increasing by 90.99 points or 0.2 percent to 39,087.38.

Simultaneously, the major European markets experienced upward movements. The FTSE 100 Index in the UK and the German DAX Index grew by 0.7 and 0.3 percent respectively, while the French CAC 40 Index nudged up by 0.1 percent.

Additionally, crude oil prices hit a four-month peak on Friday, driven by reports that oil demand in 2023 had escalated to a four-year high and is projected to remain close to this level throughout the current year. West Texas Intermediate Crude oil futures for April surged by 2.2 percent or $1.71, ending at $79.97 a barrel, the highest closing figure since November 6, 2023.