Asian stock markets experienced a general upturn on Monday, with Japan spearheading regional gains. This came after the ruling Liberal Democratic Party in Japan lost its majority in the Parliament's lower house during weekend elections. This political shift led to a significant depreciation of the yen, reaching a three-month low, which subsequently bolstered export-driven shares.
The U.S. dollar gained strength while gold prices saw a slight decline amid rising global uncertainties. Investors anticipated key economic reports from the U.S., including inflation, GDP, and labor market data, to be released later in the week.
Oil prices dipped more than 4 percent during Asian trading. Over the weekend, Israel's attack on Iran avoided targeting oil and nuclear facilities, and Iran signaled a restrained response.
In China, the Shanghai Composite Index climbed 0.68 percent, closing at 3,322.20, ahead of important economic activity reports expected this week. Investors paid little heed to data showing that China's industrial profits in September fell at the fastest rate since the pandemic’s onset.
The Hang Seng Index in Hong Kong ended slightly higher at 20,599.36 following a session marked by volatility.
Japanese markets recorded substantial gains as a depreciated yen gave a lift to major exporters such as Honda Motor, Toyota, Sony, and Nintendo, which rose by 2-4 percent. The Nikkei Index surged 1.82 percent to 38,605.53, with the broader Topix Index increasing by 1.51 percent to settle at 2,657.78, as the anticipated political outcome had already been accounted for by the markets.
In Seoul, stocks surged, driven by advancements in the technology sector, with Samsung Electronics climbing 3.9 percent. Korea Zinc soared 3.8 percent following the announcement of acquiring 9.85 percent of its own shares in a $1.5 billion buyback. The Kospi Index rose by 1.13 percent, closing at 2,612.43.
Australian markets concluded slightly higher, though gains were offset by a lagging financial sector. Meanwhile, rising iron ore prices gave the mining sector a boost. The S&P/ASX 200 ticked up by 0.12 percent to reach 8,221.50 ahead of forthcoming domestic inflation figures. The broader All Ordinaries Index went up by 0.13 percent, closing at 8,478.20.
The New Zealand market was closed for the Labour Day holiday.
Meanwhile, U.S. stocks had a mixed finish on Friday as investors prepared for a full schedule of earnings and economic data releases. Adding to the positive sentiment on the economic front, a survey revealed an unexpected uptick in U.S. consumer sentiment in October.
The Dow Jones Industrial Average dipped by 0.6 percent, marking its fifth consecutive day of losses. The S&P 500 saw a marginal decline, whereas the tech-focused Nasdaq Composite increased by 0.6 percent, buoyed by robust performance in Tesla shares.
