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Asian Markets Brace for US-China Trade Talks as US Stocks Close Higher
Singapore – Investors in Asia are closely monitoring the upcoming resumption of US-China trade talks in Stockholm on Monday, a development that could influence market sentiment across the region. The discussions, aimed at addressing long-standing economic disputes, will be led by U.S. Treasury Secretary Scott Bessent and Chinese Vice Premier he Lifeng.
Futures for Hong Kong’s Hang seng Index are indicating a slightly stronger opening, trading at 25,396 compared to its previous close of 25,388.35. Japan’s Nikkei 225 is also poised for a higher start, with Chicago futures at 41,645 and Osaka futures at 41,410, against Friday’s closing figure of 41,456.23. In contrast, Australia’s S&P/ASX 200 is expected to open lower, with futures at 8,626, down from its last close of 8,666.90.
Meanwhile, U.S. stock markets concluded Friday on a positive note, with all three major averages posting gains for the week. The S&P 500 finished the session 0.40% higher at 6,388.64.The Nasdaq Composite rose 0.24% to 21,108.32, and the Dow Jones Industrial Average climbed 208.01 points, or 0.47%,to settle at 44,901.92.
despite potential near-term market fluctuations, UBS Global Wealth Management advises investors against excessive concern. Ulrike Hoffmann-Burchardi, chief investment officer for the Americas and global head of equities, noted that while threats to Federal Reserve independence, resurgent trade tensions ahead of an August 1 deadline, and potential economic harm from tariffs could contribute to volatility, any market swings are expected to be temporary.
Markets Brace for Trump’s Fed Visit Amid Tech Earnings Mix
Dow Futures Dip as Alphabet Shines, Tesla Falters
U.S. stock futures saw a mixed early showing Thursday, as investors digested a varied batch of Big Tech earnings and watched for developments in President Donald Trump’s ongoing dispute with the Federal Reserve.
Tech Giants Deliver Divergent Results
Early Thursday, S&P 500 futures edged up 0.12%, and Nasdaq 100 futures climbed 0.36%. However, futures tied to the Dow Jones Industrial Average fell by 133 points, or 0.29%. This divergence followed earnings reports from tech titans Alphabet and Tesla. Alphabet’s stock surged 3.5% after reporting stronger-than-expected second-quarter earnings and revenue. Conversely, Tesla shares dropped 6% in active trading, reflecting investor disappointment over a second consecutive quarterly decline in automotive revenue.
Adding to the pressure on Dow futures, IBM shares declined 5% after the company’s second-quarter software revenue failed to meet analyst expectations.
Political Spotlight Turns to Federal Reserve
On the political front, President **Donald Trump** is scheduled to visit the Federal Reserve on Thursday, intensifying his public campaign against Fed Chair **Jerome Powell**. This marks the first presidential visit to the central bank in nearly two decades, a move that is likely to capture significant market attention.
Anticipation Builds for Key Economic Data and Earnings
Several major companies, including Honeywell, American Airlines, and Union Pacific, are set to release their earnings reports before the market opens today. Investors will also be closely monitoring a raft of economic data, including weekly jobless claims, the final July purchasing managers’ index readings, and June’s new home sales figures.
Markets on Wednesday experienced a robust rally, largely propelled by positive news on international trade negotiations. The S&P 500 index gained 0.78%, reaching its twelfth record close of the year. The Dow Jones Industrial Average advanced 1.14%, closing within a few points of a new all-time high. The Nasdaq Composite also saw a significant boost, rising 0.61% to settle above the 21,000 mark for the first time.
Earlier this week, **President Trump** announced a substantial trade agreement with Japan, including a 15% reciprocal tariff on goods. Reports from The Financial Times and Bloomberg also indicated progress toward a U.S.-EU trade deal, potentially featuring similar 15% tariffs on goods entering the United States from the bloc. These developments in trade policy are seen as positive catalysts for investor sentiment. According to data from the Bureau of Labor Statistics, U.S. goods and services exports totaled $2.8 trillion in 2024, underscoring the importance of international trade agreements.
“We’re beginning to see some clarity here with these deals being made, and that’s certainly bullish. And certainly that keeps the momentum going in the stock market.”
—Jeremy Siegel, Professor of Finance at the Wharton School and Senior Economist at WisdomTree
Jeremy Siegel, Professor of Finance at the Wharton School and Senior Economist at WisdomTree, commented on Wednesday that the clarity emerging from these trade agreements is bullish and contributes to the ongoing momentum in the stock market.
Asian markets Brace for Reopening as U.S. Futures Show Gains
Investors in Asia are closely monitoring the reopening of Japan’s equity and bond markets following a national holiday.The Japanese yen saw a strengthening against the U.S. dollar on Monday,reversing a trend of weakening in the weeks preceding the nation’s election.
Futures for Japan’s Nikkei 225 index indicated a higher opening, with Chicago futures at 39,830 and Osaka futures at 39,820, compared to the index’s previous close of 39,819.11. Hong Kong’s Hang Seng index futures were trading at 25,049, suggesting a stronger start than its prior close of 24,994.14. Conversely, Australia’s S&P/ASX 200 was poised for a lower opening, with futures at 8,660 against its last close of 8,668.20.Meanwhile, U.S. equity futures experienced a rise in early Asian trading hours. This comes after the S&P 500 and Nasdaq Composite concluded Monday’s session at record closing highs, having also achieved new intraday records. The S&P 500 advanced 0.14% to 6,305.60, and the Nasdaq Composite gained 0.38% to close at 20,974.17. The Dow Jones industrial Average, however, saw a slight decline of 19.12 points, or 0.04%, ending at 44,323.07.
context on Market Volatility
Despite ongoing risks related to trade and inflation, the stock market has exhibited unusual calm, with the CBOE Volatility Index (VIX) remaining notably subdued throughout the month. Though, this stability could be short-lived. As Mark Hackett, chief market strategist at Nationwide, noted, “With next week bringing the FOMC meeting, GDP data, a key tariff deadline, and a wave of earnings – in a historically weak window for the markets – even small surprises could trigger sharp reactions.” Hackett cautioned that “calm can quickly turn to complacency” and suggested that current market positioning leans towards a potential rally rather than a decline.
Asia-Pacific Markets Show Mixed Opening Signals
Mixed Performance as Investors Eye China’s Rate Decision
Asian markets experienced a divided start to the trading week, with South Korea showing gains while Australia’s benchmark index held steady. Investors are closely anticipating crucial economic data from China later today.
South Korean Stocks Advance
The Kospi index in South Korea opened higher on Monday, rising by 0.45%. In contrast, the Kosdaq, which tracks smaller companies, remained unchanged in early trading. As of 8:10 a.m. Singapore time, trading activity reflected a cautious sentiment across the region.
Australian and Japanese Markets Flat or Closed
Australia’s S&P/ASX 200 benchmark traded flat, mirroring a subdued opening. Japanese markets were closed for the public holiday observance of Marine Day, contributing to the mixed regional picture.
US Futures Show Little Movement
U.S. stock futures experienced minimal changes in early Asian trading hours, suggesting a stable outlook for Wall Street ahead of its opening. This stability comes after a mixed finish for major U.S. indices on Friday.
Friday’s U.S. Market Recap
On Friday, U.S. markets saw a downturn in afternoon trading, with the S&P 500 and Dow Jones Industrial Average ending in negative territory. Fears over escalating tariffs appear to have influenced investor sentiment, leading to a late sell-off.
The Dow Jones Industrial Average, comprising 30 large-cap stocks, fell by 142.30 points, closing at 44,342.19, a decline of 0.32%. The broader S&P 500 index saw a slight decrease of 0.01%, settling at 6,296.79. The tech-heavy Nasdaq Composite managed a modest gain, adding 0.05% to finish at 20,895.66.
Anticipation Builds for China’s Loan Prime Rate
Market participants are keenly awaiting the People’s Bank of China’s announcement on its one-year and five-year loan prime rates for July. This decision is expected to provide insights into China’s economic policy and growth trajectory. For context, China’s central bank last adjusted its benchmark lending rates in June, reflecting ongoing efforts to stimulate economic activity.
Hong Kong and Australia Futures Signal Opening Trends
Futures for Hong Kong’s Hang Seng index indicated a stronger opening, with the contract at 24,883 compared to the previous closing value of 24,825.66. Conversely, Australian S&P/ASX 200 futures pointed to a lower start, trading at 8,688 against its last close of 8,757.20.
Asia-Pacific Markets Mixed After Promising US Jobs Data
Asia-Pacific markets presented a mixed performance today, following gains on Wall Street driven by a surprisingly robust U.S. jobs report that tempered fears of an economic downturn.
Performance Across Key Markets
Japan’s Nikkei 225 index experienced choppy trading but ultimately rose by 0.23%, while the broader Topix index saw a more modest increase of 0.17%.
South Korean markets faced headwinds, with the Kospi index declining by 1.09% and the small-cap Kosdaq falling by 1.51%.
In mainland China, the CSI 300 index began the day with a 0.11% dip, while Hong Kong’s Hang Seng Index experienced a steeper decline of 1.43%.
Australia’s S&P/ASX 200, however, bucked the trend with a 0.21% increase.
US Jobs Report Impact
The better-than-expected U.S. jobs data released this week provided some reassurance to investors, suggesting that the American economy may be more resilient than previously anticipated. According to the Bureau of Labor Statistics, the unemployment rate remained at 4.0% in June, defying expectations of a rise (U.S. Bureau of Labor Statistics).