Investing.com– Most Asian stocks rose slightly on Tuesday in anticipation of an interest rate cut by the Federal Reserve, while Japanese markets were dented by a stronger yen before a Bank of Japan meeting.
Regional markets took middling cues from a mixed overnight session on Wall Street, where losses in technology stocks dragged the NASDAQ Composite lower. But the Dow Jones Industrial Average hit a record high as bets on lower interest rates drove some flows into economically sensitive sectors.
U.S. stock index futures were flat in Asian trade. Regional trading volumes were muted on account of market holidays in China and South Korea.
Asian markets buoyed by prospect of 50 bps Fed cut
Asian stocks advanced amid growing bets that the Fed will cut interest rates by 50 basis points at the conclusion of a two-day meeting on Wednesday.
Traders were seen pricing in a 68% chance for a 50 bps cut and a 32% chance for a 25 bps cut, CME Fedwatch showed.
Australia’s ASX 200 added 0.3%, while Hong Kong’s Hang Seng index rose 0.9%, rebounding from steep losses in the prior session after a swathe of weak economic data from China.
Sentiment towards China was also dented by the prospect of a renewed trade war with the West.
Futures for India’s Nifty 50 index pointed to a flat open, with the index remaining in sight of a record high. Indian inflation readings are on tap this week.
The Fed is widely expected to kick off an easing cycle from Wednesday’s meeting, with lower rates presenting a more positive outlook for stock markets. Markets are pricing at least 100 bps of rate cuts this year.
