Asia Stocks Rise on US Payrolls Optimism and China Stimulus Prospects

Investing.com—Asian markets saw an uptick on Monday, with Japanese stocks leading the charge. The rise followed strong U.S. payroll data, which eased fears of an economic slowdown, while expectations for additional stimulus measures in China further bolstered investor sentiment.

Regional stocks benefited from a Friday surge on Wall Street, driven by a significantly stronger-than-anticipated nonfarm payrolls report. This data not only alleviated recession concerns in the U.S. but also tempered expectations for a dramatic decrease in interest rates.

In Asian trading, U.S. stock index futures showed slight increases.

Trading volumes in Asia were somewhat restricted due to the Golden Week holiday in China. However, Chinese markets are projected to experience a substantial increase when they reopen on Tuesday, fueled by ongoing optimism about potential stimulus measures in the country.

Japanese Stocks Shine as Yen Weakens

Japan’s Nikkei 225 and TOPIX indexes emerged as the top performers in Asia on Monday, with gains ranging from 1.8% to 2%. These advances were in part due to a decline in the Japanese yen, reflecting growing skepticism regarding the Bank of Japan’s capacity to further raise interest rates.

Seven & i Holdings Co., the parent company of 7-Eleven, saw its stock jump over 3% following reports indicating plans to sell a stake in its supermarket division in advance of a highly anticipated listing.

In a related development, it was reported that Canada’s Alimentation Couche Tard Inc. received support from Quebec’s public pension fund to pursue a takeover bid for Seven & i after an initial offer was rejected.

Hong Kong Stocks Rise Amid China Stimulus Focus

The Hang Seng index in Hong Kong climbed 0.6%, marking a continuation of recent gains driven by optimism surrounding additional stimulus from China. This sentiment has encouraged investors to return to undervalued mainland stocks.

Mainland Chinese markets are set to reopen on Tuesday after the Golden Week holiday and are expected to see significant gains.

China’s top economic planner is scheduled to provide a briefing on Tuesday to announce more stimulus measures following a series of robust initiatives implemented in late September. These earlier measures had led to strong recoveries in the Shanghai Shenzhen CSI 300 and Shanghai Composite indexes, which had been hovering near eight-month lows.

This wave of optimism regarding China also lifted broader Asian markets, with South Korea’s KOSPI rising by 0.8% and Australia’s ASX 200 increasing by 0.5%.

Meanwhile, futures for India’s Nifty 50 index indicated a subdued start, following a sharp decline from record highs reached in September.

Beyond developments in China, this week’s attention will be on remarks from U.S. Federal Reserve officials and consumer inflation data from the U.S. Traders appear to be adjusting their expectations for another 50 basis point rate cut by the Fed in November.