Asian stocks open lower with inflation, US election on radar

BLOOMBERG – Asian stocks marked a lower start on Monday (24), which included a week of U.S. inflation data that could help navigate challenges to the outlook for global interest rates.

U.S. stock contracts were steady in early Asian trade after the S&P 500 index fell on Friday (21) amid big options expirations.

Inflation data from Australia and Tokyo and the Federal Reserve’s discretionary consumer spending index may help interest rate challenges after showing U.S. services activity rose at the fastest pace in more than two years.

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This week, as traders examine inflation data, they will also monitor rising political risks. The first US presidential debate between Joe Biden and Donald Trump is on the agenda for the first round of voting in French legislative elections scheduled for next weekend.

Traders and strategists are beginning to question how long the bond and currency markets can last. An index of global stocks rose 2.3% in the quarter, on track for a third straight quarterly gain, while US stocks hit new highs this month amid AI fever.

According to Morgan Stanley, in the case of stocks, a correction is already beginning to signal as the market breadth is “very weak”. Speed Some actions continue almost uninterrupted.

This could continue in the second half unless there is a change in the macroeconomic outlook, Morgan Stanley’s Michael Wilson wrote in a note on Sunday, signaling the need for inflation rate hikes or growth.

“Until the bond market reacts with a higher term premium or growth slows significantly, we expect this thin market performance to continue,” he wrote.

In Asia, Chinese assets extended their selloff last week as policymakers showed no rush to unleash more stimulus. The yuan fell to a seven-month low, and the benchmark Shanghai Composite fell below the 3,000 level on Friday for the first time since March.

Meanwhile, China and the European Union agreed to begin talks on the alliance’s plans to impose tariffs on electric vehicles imported from the Asian country.

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