Asian Stocks Trade With Caution Even As 'Trump Trade' Powers Wall Street To New Highs

Stocks in the Asia-Pacific region opened mixed on Tuesday as disappointing stimulus in China overshadowed Wall Street's yet another record closing driven by 'Trump Stocks'. Bitcoin surged past the $89,000 mark.

Equity benchmarks in South Korea and Australia declined while that of Japan rose in early trade. The Nikkei was 225 points, or 0.55%, higher at 39,754, while the Kospi was down 5 points, or 0.2%, at 2,526 as of 5:35 a.m.

Stocks in China will continue to be in focus after the latest data pointed out that the credit expansion slowed more than forecasted in October. Investors were underwhelmed and expended further stimulus aside of the 10 trillion yuan ($1.4 trillion) in a debt swap program to improve the finances of local governments. 

The Hang Seng China Enterprises Index fell 2.9% on Monday, leading the decline among its Asian peers, while the CSI 300 closed higher.

Japanese stocks will look for some comfort as Prime Minister Shigeru Ishiba pledged over $65 billion for the semiconductor and artificial intelligence sector after winning a vote in parliament to stay on as premier.

Meanwhile, experts reckon that India—which has seen consistent FII selling —will continue to see global funds offload stocks in November.

Much of the selling pressure stems from India's inclusion in broader emerging market portfolios, with only 10% of FII ownership via India-dedicated funds, according to Neelkanth Mishra, Chief Economist and Strategist, Axis Bank. "Won't be surprised if FII selling lasts through November," stated Mishra.

The consumer inflation print in India along with its industrial output print and South Korean unemployment figures will provide further cues to Asian stocks on Tuesday.

Elsewhere, the US stocks continued to gain as investors positioned themselves to stocks that would benefit from President-elect Donald Trump’s economic plans. The S&P 500 closed the session with its 51st record this year while Bitcoin soared over $89,000 along with listed cryptocurrency stocks.  

The S&P 500 and the tech-heavy Nasdaq Composite advanced 0.10% and 0.06%, respectively, while the Dow Jones Industrial Average rose 0.69%.

Crude oil prices saw their biggest drop in two weeks as economic outlook in China continued to soften. Brent crude was trading 2.76% lower at $71.83 a barrel as of 6:00 a.m. IST. West Texas Intermediate was up 0.25% at $68.21.