Asia-Pacific markets experienced gains on Monday as investors prepared for a week packed with significant events, including the U.S. presidential election and the Federal Reserve’s monetary policy meeting. Attention is also focused on China’s parliament meeting, which began on Monday and is anticipated to yield further details regarding fiscal support by the time it concludes on Friday.
China’s trade figures for October are set to be released on Thursday, following disappointing export and import growth in September. Additionally, South Korea will report its consumer inflation rate for October on Tuesday, which is expected to ease for the third consecutive month to 1.4% year-on-year, down from 2.6% in July, 2.0% in August, and 1.6% in September.
On the same day, the Reserve Bank of Australia will announce its interest rate decision, with a Reuters poll suggesting that the cash rate will likely remain unchanged at 4.35%. South Korea’s benchmark Kospi index climbed 1.83% to close at 2,588.97, breaking a three-day losing streak, while the small-cap Kosdaq rose 3.43% to finish at 754.08. Hong Kong’s Hang Seng index increased by 0.27%, and mainland China’s CSI 300 gained 1.41%, closing at 3,944.76. Australia’s S&P/ASX 200 index also saw a 0.56% rise, closing at 8,164.6. Japan’s markets were closed for a holiday.
Overnight in the U.S., stock futures saw a slight decline, with futures linked to the Dow Jones Industrial Average dipping by 0.3%, the S&P 500 futures losing 0.25%, and Nasdaq-100 futures also dropping 0.3%. In commodities, U.S. crude futures surged over 1% as OPEC+ member countries agreed to postpone a planned December output increase by a month. West Texas Intermediate rose by 1.42% to $70.47 per barrel, while Brent crude increased by 1.37% to $74.10.
In specific stock news, shares of SK Hynix surged as much as 5.7% on Monday after reports indicated that Nvidia CEO Jensen Huang requested to expedite the delivery of next-generation high-bandwidth memory chips (HBM4) by six months. SK Hynix has been the primary supplier of these chips, benefiting from the growing demand in the artificial intelligence sector. The company had previously stated its goal to deliver HBM4 chips in the second half of 2025 and has started mass production of its HBM3E chips, aiming for delivery by year’s end.
In diplomatic and trade news, China’s Commerce Minister Wang Wentao urged Australia to enhance its business environment and ensure fair treatment for Chinese companies. Wang expressed optimism about restoring the live lobster trade with Australia by Christmas, following an earlier agreement between Chinese Premier Li Qiang and Australian Prime Minister Anthony Albanese.
Goldman Sachs projected a potential rise of about 20% for Chinese equities listed in both Hong Kong and mainland China over the next year, favoring A-shares over H-shares. The economists noted that the outcomes of the U.S. elections and associated tariff risks could significantly impact Chinese equity markets. Although Chinese stocks had rallied over 20% in September, investor enthusiasm has waned, with the CSI 300 experiencing a 3% decline in October.
As China’s National People’s Congress commenced its five-day meeting on Monday, analysts expect announcements regarding fiscal support to emerge by Friday.
Additionally, China has reduced the capital requirement for non-controlling foreign shareholders in listed companies from $100 million to $50 million, a move aimed at attracting more foreign investment. The revised policy allows foreign individuals to engage in strategic investments in listed firms, reflecting China’s intent to promote long-term investments.
Economic policy advisor Li Daokui indicated that China may need a fiscal package of 20 to 30 trillion yuan ($2.82 trillion to $4.23 trillion) to stabilize local government debt. Current general government debt stands at 77% of GDP, significantly lower than in Japan and the U.S., although reports suggest that proposals for over 10 trillion yuan in extra debt issuance are insufficient to meet the actual needs.
