Asian equity markets and US stock futures started the week higher, rebounding from last week’s sharp decline in technology stocks. Market sentiment stabilized as expectations increased for Chinese authorities to introduce measures to bolster capital markets, while the recent drop in oil prices provided further support for risk appetite.
Tech rebound follows heavy Wall Street losses
The positive turn in Asian markets followed significant losses on Wall Street last Friday. The Nasdaq 100 Index tumbled 3.5%, marking its worst session since June. The Philadelphia Semiconductor Index fell even more sharply, losing 7.2% in a single day.
The recovery came after heavy losses on Wall Street, where the Nasdaq 100 Index fell 3.5% and the Philadelphia Semiconductor Index dropped 7.2% for its worst session since June.
On Monday, S&P 500 and Nasdaq 100 futures both rose 0.5%. European futures posted gains as well, while the MSCI Asia Pacific Index inched up 0.1%. Gains in markets such as South Korea and Hong Kong offset losses seen in Australia, reflecting a mixed response across the region.
China signals possible market support
Chinese stocks outperformed amid reports that financial regulators would meet with banks and securities firms on Monday to discuss potential steps to support capital markets. The prospect of government intervention prompted a positive response from regional investors.
Expectations for a meeting signal that authorities may again act to counter market declines, with possible support measures driving renewed buying interest in Chinese equities.
Monday’s developments continued a pattern of policy support as officials seek to stabilize markets amid persistent economic challenges. News of regulatory meetings raised hopes for actions to curb recent declines in Chinese shares.
Brent oil falls, Bitcoin and gold advance
Brent crude slipped 3% to $109.87 per barrel. The decline was attributed to reports that US President Donald Trump favors giving diplomacy with Iran more time before considering military options following Tuesday’s midterm elections. This shift in stance eased fears of escalating tensions, helping improve broader market sentiment.
The pause in geopolitical tensions has supported risk sentiment, while falling oil prices have alleviated pressure on broader markets.
Bitcoin recovered for a third consecutive day, rebounding from last week’s sell-off triggered by Binance’s announcement of a record-sized cyberattack. Gold also gained 0.8% to $3,906 per ounce, recovering after a more than one-year low at Friday’s close.
Early market moves indicated that investors were regaining confidence following heavy selling in the tech sector. However, gains in Asia remained modest at 0.1%, and weakness persisted in Australia, suggesting that the rebound’s strength varied across regions.
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