FX.co ★ Asian Shares Track Rally On Wall Street Ahead Of Powell's Testimony

Asian stocks saw a widespread uptick on Tuesday, following a modest upward movement in Wall Street equities, which closed at record highs ahead of the Federal Reserve Chair's upcoming testimony and the release of significant U.S. consumer and producer price inflation data this week.

Investors are optimistic about the U.S. earnings season, particularly with major banks such as JPMorgan, Citigroup, and Wells Fargo set to announce their quarterly results on Friday.

Federal Reserve Chair Jerome Powell is set to speak before Congress on Tuesday and Wednesday, with market participants eager for insights on potential rate movements ahead of the monetary policy meeting later this month.

The U.S. Consumer Price Index (CPI) report, scheduled for release on Thursday, is anticipated to show a decrease in inflation to 3.1 percent in June from 3.3 percent in May. The Producer Price Index (PPI) figures will follow on Friday.

In Asian trading, the U.S. dollar lingered near multi-week lows against key currencies, while gold saw a slight increase, trading above $2,360 per ounce. Oil prices continued their downward trend amid ongoing hopes for a ceasefire agreement in Gaza.

Chinese markets experienced robust gains, with the Shanghai Composite Index rising 1.26 percent to 2,959.37, ahead of a major annual policy event in the country.

Hong Kong's Hang Seng Index ended slightly lower at 17,523.23, recovering from early losses prior to the release of China's inflation data.

Japanese markets led the regional gains, driven by a surge in chip-related stocks. The Nikkei Average soared 1.96 percent to a record high of 41,580.17 as the yen weakened ahead of Powell's testimony. The broader Topix Index ended 0.97 percent higher at 2,895.55, with Advantest, Tokyo Electron, Screen Holdings, and SoftBank Corp all climbing between 2-3 percent.

In Seoul, tech shares mirrored their U.S counterparts, resulting in modest gains for local stocks. The Kospi Average edged up 0.34 percent to 2,867.38, as SK Hynix advanced 2.1 percent. In contrast, Hyundai Motor fell by 3 percent and Kia Corp decreased by 1.4 percent.

Australian markets closed significantly higher in a broad-based rally. The S&P/ASX 200 Index increased by 0.86 percent to 7,829.70, while the All Ordinaries Index grew by 0.79 percent to 8,075.20. The banking sector outperformed, led by Commonwealth Bank of Australia which rose 1.8 percent to a record high. Buy now-pay later firm Zip surged 4.3 percent and telecommunications company Telstra rose by 2.2 percent.

In New Zealand, the S&P/NZX 50 Index climbed 0.87 percent to 11,848.13, reaching a three-week high ahead of the Reserve Bank of New Zealand's policy meeting on Wednesday.

In the U.S., equities ended mixed on Monday as investors prepared for a week filled with significant economic events and processed data indicating a slowdown in payroll hiring in the latter half of the year. The Nasdaq Composite edged up 0.3 percent, and the S&P 500 gained 0.1 percent to hit record highs, driven by a rise in chipmaker stocks. However, the Dow Jones Industrial Average ended slightly lower.