Asian shares rose on Monday following a robust US jobs report that fueled optimism about the economy, leading to a surge on Wall Street. The Nikkei 225 index in Japan climbed by 1.9% to 39,354.63 as the yen weakened against the US dollar. Prime Minister Shigeru Ishiba’s focus on salary increases surpassing inflation and boosting investments for growth and distribution contributed to the positive market sentiment. While the initial public support for Ishiba is relatively low at around 50%, he aims to dissolve parliament for an election on Oct. 27.
Hong Kong’s Hang Seng index also saw a 1.4% increase to 23,056.53, while Seoul’s Kospi surged by 1.1% to 2,597.34. Taiwan’s Taiex gained 1.3%. Mainland Chinese markets are set to reopen after a weeklong holiday with plans to address economic stimulus at a news conference in Beijing. Markets anticipate more volatility following policies aimed at reviving the property market amid declining home sales and credit growth.
In the US, the S&P 500 rose by 0.9%, nearing its all-time high, while the Dow climbed by 0.8% and the Nasdaq by 1.2%. Sectors benefitting from a stronger economy, such as banks, airlines, and cruise-ship operators, led the gains. However, concerns over Middle East tensions impacting oil prices persist as the world awaits Israel’s response to an October 1 missile attack by Iran. US crude oil prices slipped to $74.19 per barrel, while Brent crude dropped to $77.76 per barrel.
Following the strong US jobs report, Treasury yields surged, indicating traders’ confidence in the job market despite the Federal Reserve’s recent rate cuts. The euro also saw a slight increase against the dollar. With hopes for sustained economic growth, market participants are reassessing expectations for additional interest rate cuts by the Fed by the year-end.
The positive market movements in Asia and the US suggest growing confidence in economic recovery amidst global uncertainties. Traders are closely monitoring geopolitical developments and policy responses to navigate potential risks and opportunities in the financial markets.