Asian markets kicked off June with robust gains on Monday, buoyed by a Wall Street rally sparked by reports indicating that U.S. inflation is not worsening. Hong Kong’s Hang Seng led the region’s surge, climbing 2.7% to 18,560.98, while the Shanghai Composite index edged up 0.3% to 3,095.63.
In Tokyo, the Nikkei 225 advanced 0.9% to 38,849.65, and Seoul’s Kospi surged 1.9% to 2,687.11. Australia’s S&P/ASX 200 also saw gains, climbing 0.7% to 7,756.80, while Taiwan’s Taiex rose 1.9%.
On Friday, the S&P 500 closed its sixth winning month in the last seven, rising 0.8% to 5,277.51. The Dow surged 1.5% to 38,686.32, while the Nasdaq slipped marginally to 16,735.02.
The positive sentiment in the stock market was fueled by easing Treasury yields following reports that U.S. inflation remained steady at 2.7% last month. This development could instill confidence at the Federal Reserve that inflation is moving towards its target of 2%.
However, concerns lingered about weakening consumer spending growth and slowing income growth among Americans. These factors, coupled with high interest rates, are contributing to challenges in maintaining spending levels.
In the bond market, the yield on the 10-year Treasury fell to 4.50% from 4.55%, alleviating some worries about tepid demand. Despite expectations of a possible rate cut by the Federal Reserve later in the year, interest rates are expected to remain high in the near term.
Amidst the market optimism, some notable stocks experienced significant fluctuations. Dell saw a 17.9% decline despite meeting profit forecasts, reflecting concerns about profit margins. Nvidia also faced a 0.8% decline as momentum slowed following a period of substantial growth.
Trump Media & Technology Group’s shares dropped 5.3% following former President Donald Trump’s felony conviction, while MongoDB witnessed a 23.9% drop despite beating profit and revenue forecasts.
In the commodities market, U.S. benchmark crude oil rose 46 cents to $77.45 per barrel, while Brent crude climbed 46 cents to $81.57 per barrel after OPEC agreed to maintain production cuts.
Currency markets saw the U.S. dollar slip against the Japanese yen, while the euro strengthened against the dollar.
Overall, the positive momentum in Asian markets at the start of June reflects optimism fueled by easing inflation concerns and supportive measures by central banks and oil-producing nations.
