Asian stock markets are poised for gains on Monday, with futures for Japan and South Korea pointing higher, while Australian futures were steady. This follows a mixed performance on Wall Street, where the S&P 500 dipped 0.4% and the Nasdaq 100 rose 0.2% on Friday. US stock futures were little changed in early trading on Monday as the US market is closed for a public holiday. The dollar traded within a narrow range against major currencies, and cash trading in Treasuries is also closed.
Oil prices increased due to renewed concerns that escalating tensions between the US and Iran, specifically weekend attacks, could disrupt crude supplies and exacerbate inflation. This geopolitical development is a key factor influencing market sentiment at the start of the week. Brent crude continued to trade at elevated levels near $96.5 per barrel, while West Texas Intermediate crude rose 0.3% to $91.80 a barrel. The price of diesel also hit an all-time high of $5.85 a gallon, indicating potential for higher transportation costs and consumer prices.
Adding to the global economic picture, China's Ministry of Finance plans to inject 300 billion yuan ($44.7 billion) in special bonds into its largest banks and insurers. This move aims to alleviate margin pressure, expand lending capacity, and strengthen provisions against potential bad loans. In corporate news, Hon Hai Precision Industry Co., a key partner for Nvidia Corp. in server assembly, reported a 52% surge in monthly sales, driven by strong demand for servers related to data centers and AI development. This highlights continued optimism and investment in the AI sector despite broader market uncertainties.
