Asian Stocks Rally as Fed Cut Bets Strengthen; Gold and Oil Stay Firm

Asian equities climbed on Wednesday, tracking Wall Street’s record-setting rally, as soft US labor market data reinforced expectations for a Federal Reserve rate cut next week. Traders widely see at least a 25-basis-point cut as certain, with slim odds on a larger move, while key inflation readings due midweek remain the final hurdle.

Japan’s Nikkei 225 rose 0.8%, South Korea’s KOSPI jumped 1.7%, and Taiwan’s TAIEX hit a record high with a 1.5% gain. Hong Kong’s Hang Seng added 1.3%, and mainland Chinese blue chips rose 0.3%. Futures pointed higher in Europe and the US after the S&P 500, Nasdaq, and Dow all closed at fresh peaks overnight.

Gold steadied at $3,644 per ounce after Tuesday’s record, while the US dollar was little changed ahead of inflation data. US Treasury yields rose for a second day, with the 10-year yield at 4.09%, and Japanese bond yields also edged higher.

In commodities, Brent crude gained 1.1% to $67.13 and WTI rose 1.1% to $63.34, extending gains after Israel’s strike on Hamas leadership in Qatar heightened geopolitical tensions. Markets also kept an eye on NATO’s defense response to Russian drone attacks in Ukraine and on political shifts in Japan and France.

The ECB meets Thursday and is expected to hold rates steady, while the Bank of Japan’s decision next week is likely to signal no immediate hike.