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Published : 17 Nov 2025, 09:26 AM
Asia's stock markets struck a cautious tone on Monday as traders looked ahead to a week of corporate earnings and catch-up US data, with the focus on the interest rate outlook and the fate of a frothy rally in artificial intelligence stocks.
Hesitant-sounding policymakers have driven market expectations for a US rate cut in December back from more than 60% a week ago to 40% on Monday and put pressure on stocks.
S&P 500 futures were 0.3% higher in early trade.
Japan's Nikkei was flat, but tourism and some retail stocks fell heavily after China cautioned citizens against visiting Japan as a diplomatic dispute deepens.
Shares in department store operator Isetan Mitsukoshi and cosmetics-maker Shiseido notched drops of around 10%.
In Australia, a 0.7% drop for BHP after Britain's high court found it liable for a dam collapse in Brazil weighed on the bourse, which hit a four-month low.
Wall Street indexes recovered from a steep selloff on Friday to notch a mixed close, with a small drop for the S&P 500 and modest gain for the Nasdaq. Ten-year US Treasury yields rose on Friday held at 4.156% in Tokyo.
JOBS, DELAYED
The headline US data release this week will be Thursday's delayed September jobs report.
The figures may be too stale to be of much use, since private surveys have already flagged a labour market slowdown. But with 19 appearances by Federal Reserve officials on the cards this week, their framing of the data will also be scrutinised.
On Friday, Kansas City Federal Reserve President Jeffrey Schmid and Dallas Federal Reserve President Lorie Logan sounded hawkish and cast doubt on the need to cut rates next month.
"There are expectations that weaker jobs data and higher inflation will mean balanced risks. Neither is good for risk, as stagflation returns to the lexicon," said Bob Savage, BNY's head of markets macro strategy.
Data in Asia showed Japan's economy contracted for the first time in six quarters due to a hit from US tariffs.
The Nikkei newspaper reported over the weekend that Japan is considering spending around 17 trillion yen ($110 billion) in new Prime Minister Sanae Takaichi's first stimulus package, underscoring her focus on expansionary fiscal policy.
That kept pressure on the yen at 154.54 per dollar and had markets on intervention-watch, while the bond market slid and sent 10-year yields to their highest since 2008.
Some analysts see risks of flight if investors' faith in fiscal discipline is shaken, much as it was in Britain last week when stocks, bonds and sterling tumbled on reports Finance Minister Rachel Reeves was backing away from tax hikes.
NVIDIA EARNINGS
Home Depot, Target , Walmart and Nvidia report earnings in the US this week and all eyes are on the chipmaker, where the market's response is shaping as a test of the sparkling rally.
"If you don't see the growth that I think the market is expecting around Nvidia or the positive commentary that we are likely to get from Nvidia going forward, I think you're going to see more of a dent to those sorts of trades," Orton said.
Nvidia shares have soared about 1,000% since the launch of ChatGPT in November 2022. This includes a year-to-date gain of more than 40% that made Nvidia the first company to surpass $5 trillion in market value last month.
Elsewhere, in foreign exchange the dollar was up slightly, holding the euro to $1.1607 and creeping higher on other majors.
Gold nursed Friday losses at $4,084 an ounce. Brent crude futures slipped 1% to $63.78 in the Asia morning.
Bitcoin, which has lately behaved as a barometer of liquidity and the mood on technology stocks, was nursing its largest weekly fall since March, having lost more than 10% last week. It traded at $94,717.
