Asian Markets Rise on Hopes of U.S. Interest Rate Cuts

Asian stock markets rose with new hopes of a possible interest rate cut in the United States. Last week, the markets, which experienced volatile movements due to concerns about a technology bubble, found some calm with this positive development.

Investments in the field of artificial intelligence significantly increased stock values this year, allowing many companies to break records. In particular, microprocessor giant Nvidia drew attention last month by surpassing $5 trillion for the first time.

However, investors have started to worry that the enormous amounts of money flowing into the sector are excessive and that it may take time for profits to materialize. This situation has led to warnings of a potential market correction.

In recent weeks, the decreasing expectations for the Federal Reserve to cut interest rates for the third time next month have increased uncertainty in the markets. High inflation continues to surpass weaknesses in the labor market.

However, comments made by New York Fed President John Williams on Friday revivified the market's risk appetite. Williams expressed that he sees 'more adjustment possibilities' for the interest rate at the meeting scheduled for December 9-10. Following these statements, the likelihood of an interest rate cut rose from 35% to nearly 70%.

This week, the focus of the markets will be on the producer price index announcement. This data is significant as it is one of the last important figures before the officials meet. IG market analyst Fabien Yip stated, 'The importance of this reading has increased due to the postponement of the October personal consumption expenditures report.'

'A much stronger-than-expected result in the producer price index could reinforce concerns that inflation pressures are still entrenched and could limit the Federal Reserve's capacity to cut rates in December,' he added.

Following the rally on Wall Street on Friday, Asian stock markets started positively. Hong Kong and Seoul gained more than 1%, while Sydney, Singapore, Wellington, and Taipei also recorded increases. On the other hand, Shanghai and Manila experienced slight pullbacks. Futures in the United States rose.

Tokyo was closed due to a holiday.

Still, while the atmosphere is somewhat calmer than last week, uncertainty continues to affect risky assets. Bitcoin is trading at around $87,000. Although this is an increase from the seven-month low of $80,553, it is still significantly lower than the $126,200 reached last month.

- Main data around 0230 GMT -

• Hong Kong - Hang Seng Index: 1.4% increase to 25,568.08
• Shanghai - Composite Index: 0.1% decrease to 3,829.71
• Tokyo - Nikkei 225: Closed due to holiday
• Dollar/Yen: 0.2% increase to 156.70 yen
• Euro/Dollar: 0.03% decrease to 1.1515 dollars
• Pound/Dollar: 0.08% decrease to 1.3096 dollars
• Euro/Pound: 0.04% increase to 87.92 pence
• West Texas Intermediate: 0.2% decrease to $57.93/barrel
• Brent North Sea Crude: 0.2% decrease to $62.44/barrel
• New York - Dow: 1.1% increase to 46,245.41 (close)
• London - FTSE 100: 0.1% increase to 9,539.71 (close)