Asian Stocks Gain as Investors Count Down to Cuts – Asia Market Wrap

A third session of gains in Asian markets was accompanied by a three-week high in the yen as investors became more optimistic about potential future reductions in interest rates by the Federal Reserve.

On Monday, shares in Australia and Hong Kong saw gains thanks to Chair Jerome Powell’s statement at Jackson Hole that the “time has come” to switch to monetary easing. Due to Asian-domiciled funds adding to their existing short bets on the greenback, the Fed’s dovish stance also helped the yen’s value relative to the dollar. The higher local currency caused Japanese stocks to fall, but US equity contracts remained stable.

Global equities are trading just below an all-time high, investors are buying sovereign debt, and the financial markets are gearing themselves for lower US borrowing costs. On Monday, the yield on US 10-year Treasuries decreased by one basis point to 3.79%.