Asian markets close in positive territory after Wall Street’s latest record run

Indices

Asian equity markets are displaying a cautiously optimistic tone, with the main indices advancing on the back of technology sector strength and supportive policy signals. The Nikkei 225 is trading at 50.84K, up 1.37, reflecting robust gains in Japanese technology shares and renewed investor interest ahead of a pivotal Bank of Japan policy meeting. The Hang Seng Index has climbed to 25.98K, advancing 1.75, buoyed by optimism following China’s Central Economic Work Conference. The Shanghai Composite Index stands at 3.89K, up 0.41, as policy support for investment and consumer spending improves sentiment. All three indices currently exhibit a FLAT short-term trend, suggesting a consolidation phase as investors digest recent gains and await further catalysts.

Stocks

In Japan, technology and industrial names are leading the rally. SoftBank Group Corp. (9984.T) surged by 3.9, reflecting strong optimism in the tech sector. Fanuc Corporation and Yaskawa Electric Corporation have also posted significant gains, underlining a rotation into automation and robotics amid global demand for advanced manufacturing. In Hong Kong, large-cap technology stocks such as Alibaba Group Holding Limited (9988.HK) and Tencent Holdings Limited (0700.HK) have advanced, benefitting from renewed investor appetite for Chinese tech and early signs of policy easing. The Shanghai market is witnessing selective buying in consumer and industrial names, with high-turnover stocks drawing tactical flows while sector leadership remains fluid due to macroeconomic uncertainty.

Economic News

Recent economic data has notably shaped risk appetite. In Japan, the November Manufacturing PMI contracted to 48.7, indicating ongoing weakness in industrial activity. Nevertheless, a strong 30-year Japanese Government Bond auction and speculation about a potential rate hike by the Bank of Japan have supported the yen and bolstered equity flows into cyclical exporters. In China, factory activity remains subdued, with the latest PMI print at 49.2, highlighting persistent macro headwinds despite policy stimulus hopes. Hong Kong’s retail sales rose 5.3, exceeding expectations and providing a boost to consumer-linked equities.

Economic Events

Attention is firmly on the upcoming Bank of Japan policy meeting scheduled for December 18–19, where markets are pricing in a meaningful probability of a rate hike. This prospective shift is expected to have significant implications for the Japanese yen and equity markets, with ripple effects across Asia. In China, the Central Economic Work Conference has set the tone for 2026, emphasizing investment and consumer demand as policy priorities—these measures are likely to influence the trajectory of both A-shares and Hong Kong-listed Chinese equities. Globally, the Federal Reserve’s recent rate cut and the anticipation of further US monetary policy adjustments are shaping cross-border capital flows and risk appetite in Asia.

Market Sentiment

Overall sentiment across Asian markets is cautiously optimistic but marked by selectivity and tactical positioning. The Nikkei 225 is supported by sector rotation into technology and industrial names and by a supportive policy backdrop, despite persistent concerns over global growth and domestic manufacturing. The Hang Seng Index is benefitting from selective large-cap buying, particularly in technology, while remaining exposed to policy and macroeconomic uncertainties. The Shanghai Composite displays a more neutral-to-cautious tone, with weak domestic activity and manufacturing data tempering bullishness. Investors are favoring defensive and short-term momentum strategies while closely monitoring central bank decisions and policy-driven inflection points.

Please note that the analysis is for informational purposes only and does not constitute financial advice. Users should conduct their own research.