Asian equities showed little overall movement on Monday, with most investors treading carefully ahead of the expiration of the current US-China tariff truce later this week. In contrast, Australian shares climbed to an all-time high, fueled by growing expectations of an imminent interest rate cut by the Reserve Bank of Australia (RBA).
Market activity in the region was subdued, partly due to Japan’s public holiday, which kept trading volumes light.
On Wall Street, Friday’s session ended with gains, supported by optimism over the possibility of a Federal Reserve rate cut. US stock index futures posted modest advances during Asian trading hours on Monday.
Markets Await Decision on US-China Trade Pause
The temporary suspension of tariffs between the United States and China is set to expire on August 12. While many traders anticipate an extension, uncertainty lingers over the outcome.
Official data from China revealed a 7.2% year-on-year increase in exports for July, potentially reflecting a rush by exporters to ship goods ahead of any new trade barriers.
Adding to trade tensions, the US announced new “reciprocal” tariffs on certain imports from multiple countries on August 7, with some rates reaching up to 50%.
In equity market movements, China’s Shanghai Composite Index gained 0.1%, while the CSI 300 advanced 0.2%. Hong Kong’s Hang Seng Index dipped 0.1%. Both South Korea’s Kospi and Singapore’s Straits Times Index were little changed.
On the corporate front, shares of South Korea’s SK Hynix jumped over 3% following reports that the company expects annual growth of around 30% in the AI-focused memory chip market by 2030.
Elsewhere in Southeast Asia, the Philippines’ PSEi Composite declined 0.5%, while Indonesia’s Jakarta Composite rose 0.6%. India’s Nifty 50 futures inched up 0.1%.
Australian Shares Rally on Rate-Cut Bets
Australia’s S&P/ASX 200 index gained 0.5% on Monday, setting a fresh record high as traders positioned themselves ahead of the RBA’s policy meeting later this week.
Markets widely expect the central bank to trim its cash rate by 25 basis points to 3.60%, citing soft inflation readings and early signs of weakening in the labor market.