© Reuters
By Amber Warrick
Investing.com — Most Asian stocks remained in a tight range on Monday as markets awaited more clues on monetary policy from a series of events from the Federal Reserve this week, while Chinese stocks rose with strength on the prospect of further stimulus spending by the government.
The China and China indices rose about 1% each after Banco Popular hit record lows. While the move disappointed some traders who had expected a cut, it still indicated that Beijing intends to keep monetary policy as accommodative as possible to boost economic growth.
Gains in China spilled over to Hong Kong and Taiwan, with the and indices rising 0.7% and 0.4%, respectively. China’s move also comes shortly after the government reiterated its plans to increase stimulus measures to spur economic recovery.
While an economic recovery in China bodes well for broader Asian markets, signals from the country have so far been mixed, even after it eased most anti-COVID restrictions earlier this year.
Most other Asian markets remained in a tight range on Monday, with traders hunkered down ahead of a slew of Fed speakers due out this week. Focus is also on the Fed’s February meeting, which is expected to reiterate the bank’s aggressive rhetoric.
Hotter-than-expected data weighed heavily on Asian markets over the past week as traders feared further interest rate hikes that could drive capital away from the region.
and stocks led losses in Southeast Asia on Monday, losing 0.3% apiece, while Japan’s index traded sideways.
Sentiment towards Asian markets was also affected by fears of escalating tensions on the Korean peninsula, after North Korea launched two ballistic missiles into the sea off the west coast of Japan.
Still, South Korea was up 0.3% as the country will benefit from any economic recovery in China.
India’s y indices rose slightly, although concerns about rising inflation in the country capped any upside potential. The Reserve Bank recently signaled that it will continue to tighten policy to reduce inflation, a scenario that does not bode well for the country’s stocks.