Asian equities are poised for positive trading, buoyed by a mildly optimistic day on Wall Street, despite a lack of significant market-moving news. This upbeat mood may be partly attributed to the anticipated “Santa Rally.” A notable sector to watch is energy, which could emerge as a top performer, driven by a spike in oil prices. This surge is a consequence of several shipping companies halting their passage through the Red Sea, effectively restricting access to the vital Suez Canal. The disruption is linked to ongoing attacks by Yemen’s Houthi rebels.
The market’s focus is now shifting to the Bank of Japan’s (BoJ) meeting in today’s session. Despite this, recent reports suggest the BoJ is not inclined to end negative interest rates in December, preferring to make decisions based on up-to-the-minute data. Upcoming economic data releases are also in the spotlight for the week, though market liquidity remains subdued as the year-end approaches. In China, expectations are that the People’s Bank of China (PBoC) will keep the Loan Prime Rates (LPR) unchanged next week. The 1-Year LPR stands at 3.45%, and the 5-Year LPR at 4.20%. PBoC Governor Yi Gang’s latest statements indicate a continued commitment to accommodative monetary policies, focusing on lowering effective lending rates and implementing targeted, impactful measures.
