Asian Stocks Gain With US Election, Fed Meet In Focus This Week

Stocks in the Asia-Pacific region began the week positive ahead of the Federal Reserve meet and the closely contested presidential race in the US.

Equity benchmarks in South Korea and Australia opened higher while the stock market in Japan will be shut for a public holiday. The S&P ASX 200 was 22 points, or 0.27%, higher at 8,140, while the Kospi was up 8 points, or 0.32%, at 2,548 as of 5:40 a.m.

Stocks in China will be in focus as its Standing Committee of National People’s Congress will meet from Monday to Friday, with investors eyeing further fiscal measures to revive the economy.

In a move to attract foreign investments, China on late Friday, announced measures to attract overseas money as they are now allowed to provide capital for publicly traded firms as strategic investors.

On Monday, the key data to watch out for in Asia will be Pakistan's interest rate decision and India's HSBC PMI manufacturing print.

Meanwhile, the US dollar weakened as no clear advantage showed between Kamala Harris and Donald Trump in the presidential election that is due on Nov. 5. The greenback fell against the yen, pound, euro, Mexican peso, Australian dollar and New Zealand dollar in early trading, according to Bloomberg News.

Meanwhile, the Federal Reserve will decide on its key interest rate on Thursday, likely influenced by the candidate emerging victorious in the election race. While Chair Jerome Powell will likely stress that the current conditions warrant less restrictive policy, he still risks political backlash.

Stocks in the US failed to read into the showing slowing hiring and weak unemployment data as equities closed higher. The S&P 500 and Dow Jones Industrial Average climbed 0.41% and 0.69%, respectively, while the Nasdaq Composite advanced 0.80%.

Distorted by severe hurricanes and a major strike, the US hiring advanced at the slowest pace since 2020 in October while the unemployment rate remained low. 

Tech megacaps led gains on Friday on strong earnings and positive guidance. Treasury 10-year yields advanced nine basis points to 4.37%.

On the commodity front, crude oil prices rose after the OPEC+ agreed to delay its December production increase by a month. Brent crude was trading 1.44% higher at $74.15 a barrel as of 6:00 a.m. IST. West Texas Intermediate was up 1.53% at $70.55.