Asian Stocks Rebound Driven by Wall Street’s Rise and Earnings Season: Asian markets experienced a significant rebound,
benefiting from Wall Street’s strong performance and tech companies’ earnings season.
These movements come amid a continuous decline in global indices
as investors look forward to a new period of calm and stability.

Contents

MSCI Index

Return of Calm to the Markets

Risk Sentiment

Performance of Bonds and Currencies

Economic Policies in Asia

Awaiting Earnings

Shifts in Investor Sentiment

Strategists Expectations

S&P 500 Earnings Performance

Commodity Market

MSCI Index Halts Three-Day Decline

Asian stocks followed the footsteps of Wall Street’s rebound as investors looked beyond Joe Biden’s re-election campaign end
to focus on the start of the tech companies’ earnings season.
The MSCI Asia Index halted its three-day decline, with stocks rising in Taiwan and Japan.
Hong Kong stocks fluctuated at the opening.
This came after a 1.1% jump in the S&P 500 index ahead of the earnings announcements of Tesla and Alphabet,
scheduled to be released later today, Tuesday.

Return of Calm to the Markets

During the past few sessions, the calm returned to the markets after high valuations
and political uncertainties led to massive sell-offs driven by tech stocks.
Despite the many headlines following Biden’s withdrawal from the race
and Kamala Harris’s endorsement, U.S. volatility fell as buyers emerged at the dips.

Risk Sentiment

Vishnu Varathan, head of economics and strategy at Mizuho Bank in Singapore, said:
“Risk sentiment and the Democrats’ support for Kamala Harris seem strong, or at least on the way to being so.
” He added: “What remains to be seen is whether the upcycle will see gains realized
by the ‘Magnificent Seven,’ becoming broader to include small stocks.”

Performance of Bonds and Currencies

Treasury yields fell ahead of this week’s economic data and the Federal Reserve’s preferred inflation gauge.
For most of July, bets on a September rate cut led to the rise of short-term bonds,
narrowing the gap with longer-term maturities.

The Japanese yen rose slightly, hovering near 157 yen per dollar ahead of next week’s Bank of Japan policy meeting.
According to people familiar with the matter,
Bank of Japan officials see that weakness in consumer spending will complicate their decision to raise interest rates this month.

Australian bond yields rose, while the currency remained largely unchanged after a six-day decline amid falling commodity prices.
The U.S. dollar stabilized in early Asian trading.

Economic Policies in Asia

In Asia, Indian Finance Minister Nirmala Sitharaman will present the budget today,
outlining the economic priorities of the new coalition government led by Prime Minister Narendra Modi.

Awaiting Earnings

SK Hynix Inc., Contemporary Amperex Technology Co, and Keyence Corp.
are among the earnings companies set to announce in the region this week.

Almost two-thirds of participants in Bloomberg’s “Markets Live Pulse” survey expect earnings to boost the U.S. index.
The “Magnificent Seven” index rose by more than 2% on Monday, led by gains in Tesla and Nvidia.

Shifts in Investor Sentiment

After leading the rise in U.S. stocks most days of the year, major tech companies hit a wall last week.
Investors shifted from high-flying large stocks to more risky and declining market parts,
driven by bets on Federal Reserve rate cuts and the threat of imposing more trade restrictions on chipmakers.

Strategists’ Expectations

Strategists at the BlackRock Investment Institute reaffirm their confidence
in U.S. stocks despite the S&P 500’s worst week in three months.

A team of strategists led by Wei Li considered the declines a “buying opportunity.”
They added that “despite the short-term noise” about the rise of small-cap stocks,

major tech companies will likely continue generating returns, positively reflecting on the markets.

S&P 500 Earnings Performance

The S&P 500 earnings estimates did not drop in the second quarter as much as they did previously,
According to strategists at JPMorgan, there is little room for disappointment in the current earnings season.
A team led by Mislav Matejka said that expectations typically fall by 5%
in the three months preceding results, but the decline was about 1% this time.

Commodity Market

Oil prices stabilized near a six-week low in the commodities market
as traders awaited new clues about market balances, including U.S. inventory forecasts.

Asian Stocks Rebound Driven by Wall Street’s Rise and Earnings Season

Asian Stocks Rebound Driven by Wall Street&#8217;s Rise

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Asian Stocks Rebound Driven by Wall Street’s Rise