Asian markets may exhibit a positive tone following a somewhat volatility end to the month session. But the tone is risk-on, particularly for the technology sector, which can be led by the Nasdaq 100, that experienced a resurgence, largely due to gains in the semiconductor industry. This comes in the wake of the US Core PCE inflation figures meeting forecasts. A decline in US yields during the session could provide a boost to Asian bond and stock markets, given their sensitivity to US interest rates.
The Japanese Yen stood out as a notable performer, spurred by the Bank of Japan’s hawkish remarks. Japanese stocks, too, might capture investors’ attention, especially as local market participants may continue to unwind hedging and offshore bets in Favour of domestic equities, with the Nikkei approaching record levels. However, concerns about regional banking stability could resurface, highlighted by the after-market hours slump of New York Community Bancorp, which tumbled 18% after disclosing significant internal control weaknesses and a delay in its 10-K filing, as per discussions with KPMG.
As we transition to today’s session, marking the commencement of March and the final month of the quarter, a slew of important data awaits. This includes the US ISM Manufacturing PMI for February and the final reading of the University of Michigan’s consumer sentiment index, in addition to Chinese manufacturing and services PMI figures. For China PMI’s data may indicate some level of recovery, a potential miss could underscore the necessity for further policy adjustments. The recent rate reductions by the People’s Bank of China are anticipated to play a significant role in bolstering the economy in the ensuing months.
