Asian stock markets are experiencing mostly upward trends on Monday, taking cues from Wall Street's positive performance on Friday. Investors are reacting to robust U.S. employment data, which has allayed some worries about the economic outlook, yet diminished the hopes for significant interest rate reductions in the near future. However, concerns are still present due to rising tensions in the Middle East. Asian markets displayed mixed outcomes last Friday.
Post-release of the jobs data, CME Group's FedWatch Tool suggests a 91.2% likelihood that the Federal Reserve will reduce rates by a quarter point in November, with only an 8.8% probability of a further half-point cut.
In the Australian stock market, shares are modestly gaining ground on Monday, reversing previous losses and aligning with Wall Street's overall positive sentiment. The benchmark S&P/ASX 200 index is approaching the 8,200 level, driven by gains in financial and technology sectors, although offset by weaknesses in gold mining stocks.
The S&P/ASX 200 Index is up by 36.80 points or 0.45% at 8,186.80, after peaking at 8,199.60 earlier. Meanwhile, the All Ordinaries Index has increased by 43.30 points or 0.51%, reaching 8,459.90. Notably, Australian stocks had recorded significant declines on Friday.
Examining major mining stocks, BHP Group is marginally up by 0.4%, Fortescue Metals has risen by over 1%, and Mineral Resources has surged by nearly 4%, while Rio Tinto is down 0.5%. The oil sector presents a mixed outlook: Origin Energy is down more than 1%, Woodside Energy has fallen by 0.1%, Beach Energy is up by 0.2%, and Santos remains steady.
In the technology sector, Block, the owner of Afterpay, and Appen both show gains of nearly 3% each. Xero has increased by 0.4%, WiseTech Global by almost 1%, and Zip has advanced by 5%.
Gold mining shares are mostly on the decline. Evolution Mining is down by almost 3%, Resolute Mining by nearly 5%, and Northern Star Resources has decreased by nearly 1%, while Newmont and Gold Road Resources show a 0.4% increase each.
Among the major Australian banks, Commonwealth Bank and National Australia Bank have both gained almost 1%. ANZ Banking is slightly up by 0.5%, and Westpac has increased by more than 1%.
In other notable news, shares in Arcadium Lithium have skyrocketed by 44% following Rio Tinto's announcement of contemplating its acquisition.
On the currency front, the Australian dollar is trading at $0.681 on Monday.
Turning to Japan, the stock market is showing strong gains, further building on the previous two sessions’ positive momentum. The benchmark Nikkei 225 Index finished the morning session at 39,354.63, up by 719.01 points or 1.86%, after reaching a high of 39,514.57 earlier. Japanese stocks had a moderate uptick on Friday.
Market leaders like SoftBank Group have climbed more than 3%, and Fast Retailing, the operator of Uniqlo, has added over 2%. In the automotive sector, Honda has gained over 2%, while Toyota follows with similar gains.
In the technology sphere, Screen Holdings is up by nearly 4%, Advantest has added 3.5%, and Tokyo Electron shows an increase of almost 1%.
In banking, Sumitomo Mitsui Financial has risen by almost 4%, Mitsubishi UFJ Financial added over 4%, and Mizuho Financial advanced nearly 5%.
Among major exporters, Canon and Mitsubishi Electric show gains of around 2% each, while Panasonic is up by more than 1%, and Sony is rising by over 4%.
Noteworthy gainers include Isetan Mitsukoshi, surging over 8%, Resona Holdings up nearly 8%, Konami Group gaining beyond 6%, and Recruit Holdings up more than 5%. Additionally, Nomura Holdings, J. Front Retailing, Chiba Bank, Nitto Denko, Hitachi, Sumitomo Electric Industries, and MS&AD Insurance Group each rose by more than 4%.
Conversely, Disco saw a significant decline, plunging over 7%.
In currency markets, the U.S. dollar trades in the lower 148 yen-range on Monday.
Elsewhere in Asia, Taiwan is up by 1.1%, with markets in Hong Kong, Singapore, South Korea, and Malaysia gaining between 0.3% and 0.8%. Conversely, New Zealand and Indonesia have slipped by 0.5% and 0.3%, respectively. China remains on holiday observance for National Day.
On Wall Street, Friday's session closed on a strong note as the upbeat non-farm payroll data helped alleviate worries about Middle East tensions, prompting robust buying activity across numerous sectors.The Dow Jones Industrial Average reached a new all-time high, closing at 42,352.75 with an increase of 341.16 points, or 0.81%. Similarly, the S&P 500 rose by 51.13 points, or 0.9%, to close at 5,751.07, and the Nasdaq Composite advanced by 219.37 points, or 1.22%, ending the session at 18,137.85.
In Europe, market outcomes varied. The DAX in Germany increased by 0.55%, and France's CAC 40 rose by 0.85%, while the U.K.'s FTSE 100 experienced a slight decline.
Crude oil prices also ended higher as the trading week concluded, largely due to concerns about a potential Israeli attack on Iran's oil facilities. Additionally, positive U.S. employment data contributed to the rise in oil prices. West Texas Intermediate (WTI) crude oil futures for November delivery increased by $0.67, or 0.91%, reaching $74.38 per barrel, marking a five-week high. Over the week, WTI crude futures climbed by more than 9%.