BANGKOK (AP) - Asian stock markets exhibited mixed results on Monday, following the impressive performance of U.S. stocks, which reached new record highs as they concluded another successful week. U.S. futures and oil prices were on the rise in anticipation of trade talks scheduled to take place in Stockholm between American and Chinese officials.
European futures also saw an uptick after the European Union reached a deal with the Trump administration, which entails 15% tariffs on a majority of exports heading to the U.S. This agreement was disclosed following a brief meeting between President Donald Trump and European Commission chief Ursula von der Leyen at the Turnberry golf course in Scotland. The deal is designed to prevent the implementation of much higher import duties that could potentially cause significant disruptions to global economies.
Tokyo's Nikkei 225 index experienced a decline of 1%, closing at 41,056.81. This decline was, in part, due to uncertainties regarding the trade agreement between Japan and the U.S., particularly concerning Japan's announced $550 billion investment pledge in the U.S. Negotiations for the agreement are ongoing, and an official who wished to remain anonymous revealed that the intention is for a $550 billion fund to be managed at Trump's direction.
In contrast, Hong Kong's Hang Seng index rose by 0.4%, reaching 25,490.45, while the Shanghai Composite index dropped 0.2% to 3,587.25. Taiwan's Taiex gained 0.3%. A notable mention is CK Hutchison, a Hong Kong conglomerate, which is divesting its interests in ports at the Panama Canal and may seek a partnership with a Chinese investor to form a buyers' consortium. However, this move could attract heightened scrutiny from the U.S. due to its geopolitical implications. CK Hutchison's shares fell by 0.6% on Monday as a result.
Elsewhere in Asia, South Korea's Kospi was nearly flat at 3,195.49, whereas Australia's S&P/ASX 200 climbed by 0.3% to 8,688.40. India's Sensex encountered a slight dip of 0.1%. Notably, markets in Thailand remained closed to observe a holiday.
On the previous Friday, the S&P 500 set a new record, rising by 0.4% to 6,388.64 and marking its fifth all-time high in just a week. Similarly, the Dow Jones Industrial Average increased by 0.5% to 44,901.92, and the Nasdaq composite saw a slight gain of 0.2%, closing at 21,108.32, thus surpassing its own record.
Stocks of Deckers, the company known for Ugg boots and Hoka shoes, surged 11.3% after it reported better-than-expected profits and revenue for the spring season, with international sales witnessing an almost 50% increase. Conversely, shares of Intel plummeted by 8.5% after the company reported a significant loss in the recent quarter, contrasting sharply with analyst expectations of a profit. Further complicating its situation, Intel announced job cuts as part of a strategy to stabilize its financial footing. The chipmaker has been struggling in an increasingly competitive market dominated by rivals like Nvidia and Advanced Micro Devices, especially as demand for artificial intelligence chips rises.
As companies face pressure to deliver strong profit growth to justify significant stock price increases—many of which have reached new heights recently—Wall Street remains optimistic. President Donald Trump's trade negotiations with other countries are seen as a critical factor in reducing high tariffs that pose recession risks and contribute to inflationary pressures. Trump has made strides in forming agreements with Japan and the Philippines, with a significant deadline approaching on August 1.
Additionally, this week, the Federal Reserve is set to convene to discuss interest rate policies. On Thursday, Trump reiterated his call for the Fed to lower rates, suggesting that this could alleviate the federal government's debt servicing costs. Fed Chair Jerome Powell has indicated that he is awaiting more data regarding the effects of tariffs on the economy and inflation before making any potential alterations to interest rates. The prevailing expectation in the market is that the Fed will postpone any rate cuts until September.
In early trading on Monday, U.S. benchmark crude oil saw an increase of 24 cents, reaching $65.40 per barrel, while Brent crude, the international standard, also rose by 24 cents to $67.90 per barrel. Meanwhile, the dollar gained ground against the yen, rising to 147.72 from 147.71, and the euro slipped slightly to $1.1755, down from $1.1758.
