Investing.com– Most Asian stocks rose sharply on Monday with focus on an upcoming Federal Reserve meeting for more cues on interest rate cuts, with the battered technology sector leading gains.
But Chinese markets continued to lag their regional peers, as sentiment towards the country showed little signs of improving ahead of more key economic readings this week.
Regional stocks took positive cues from a strong finish on Wall Street on Friday, as signs of easing inflation drove up bets that the Fed will eventually cut interest rates this year. U.S. stock index futures also rose in Asian trade on this notion.
The Fed is set to at the conclusion of a two-day meeting on Wednesday. But any signals on when it plans to begin cutting rates will be closely watched, especially amid encouraging comments from Fed officials.
Asian tech extends rebound
Tech-heavy Asian bourses continued to lead amid an extended rebound in tech stocks. Japan’s index surged 2.2%, while South Korea’s and Hong Kong’s rose around 1% each.
Tech stocks saw a degree of bargain buying after being walloped by profit-taking over the past two weeks, while expectations of rate cuts also saw investors pivot into more economically sensitive sectors.
But investors were seen moving back into the sector, especially ahead of several key earnings due this week. U.S. tech giants Microsoft Corporation (NASDAQ:), Apple Inc (NASDAQ:) and Meta Platforms Inc (NASDAQ:) are set to report second-quarter earnings in the coming days, offering up more cues on the industry and artificial intelligence.
Chinese stocks lag amid few positive signals
China’s and indexes fell 0.4% and 0.1%, respectively, remaining close to five-month lows and seeing little relief from negative sentiment towards China.
Fears of a slowing Chinese economic recovery- following a series of weak readings through July- sparked extended selling in Chinese markets.
U.S. political uncertainty also weighed on Chinese markets, especially with investors uncertain over how the next U.S. administration will treat Beijing.
Focus this week is on data from the country for July, for more cues on business activity.
Broader Asian markets rose. Australia’s added 0.8%, while Japan’s index added 1.9%.
for India’s index pointed to a positive open, with the index set to extend gains after surging to record highs last week.
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