Asian stock markets advanced on Monday, recovering part of last week’s losses as renewed expectations of a U.S. Federal Reserve interest rate cut in December strengthened investor confidence. Buying interest returned to the region’s beaten-down technology sector, although overall trading activity was somewhat subdued due to a market holiday in Japan.
Market sentiment improved after Wall Street closed higher on Friday, boosted by dovish comments from Federal Reserve officials. Futures tracking the S&P 500 climbed 0.5% in early Asian hours, signaling broader optimism ahead of key U.S. economic data releases for September, including inflation and labor market indicators. Traders are now pricing in a roughly 67% chance of a 25-basis-point rate cut in December—up sharply from last week’s estimates—according to CME FedWatch, driving demand for risk assets.
Across Asia, South Korea’s KOSPI led gains with a 1.2% rise, followed by Australia’s ASX 200, which climbed 1%. Hong Kong’s Hang Seng Index added 1.3% as investors cautiously returned to tech names. India’s Nifty 50 futures were flat, reflecting a more measured market response.
Chinese stocks, however, underperformed. Mainland markets slipped about 0.3% as chipmaking shares experienced steep declines. Semiconductor Manufacturing International Corp dropped more than 7%, while AI chip firm Cambricon Technologies also weakened. The sell-off followed reports that the U.S. may allow NVIDIA to resume sales of its advanced H200 AI chips in China, potentially reducing demand for domestically produced semiconductors and raising concerns over China’s tech self-sufficiency goals.
Still, some Chinese tech giants posted modest gains. Tencent edged up 0.7%, Alibaba added 0.3% ahead of earnings, and Baidu rose nearly 2% after a JPMorgan upgrade citing strong AI and cloud growth potential.
Despite recent volatility, investors remain focused on the potential boost that lower U.S. interest rates could bring to global liquidity and risk-driven markets.


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