November 3, 2025 — Asian markets climbed Monday, buoyed by optimism from Wall Street’s AI-fueled rally and signs of easing China–US tensions, as investors looked ahead to key U.S. economic data later this week.
Traders entered the new week in upbeat spirits following a strong close to October. A combination of healthy corporate earnings, a Federal Reserve rate cut, and a positive shift in U.S.–China relations helped restore confidence after months of geopolitical uncertainty.
Major Wall Street indexes ended last week at record highs, powered by the ongoing artificial intelligence investment frenzy and another surge in tech stocks — led by Nvidia, which last week became the first company to reach a $5 trillion valuation.
Asian Markets Track Wall Street Gains
The bullish momentum extended across Asia on Monday.
- Hong Kong’s Hang Seng Index climbed 1.0% to 26,156.81.
- Shanghai’s Composite Index advanced 0.6% to 3,976.52.
- Seoul’s KOSPI jumped 2.8% to a record high, fueled by optimism over improving relations between South Korea and China.
- Gains were also recorded in Singapore, Sydney, Wellington, Bangkok, and Taipei.
- Mumbai and Manila slipped slightly, while Tokyo remained closed for a public holiday.
Analysts said markets were benefiting from a rare alignment of positive factors — looser monetary policy, upbeat tech earnings, and reduced trade tensions.
Trump–Xi Deal Eases Trade Pressures
Investors continued to react positively to last week’s meeting between U.S. President Donald Trump and Chinese President Xi Jinping, which resulted in an agreement to ease restrictions on rare earth exports and reduce certain U.S. tariffs on Chinese goods.
However, U.S. Treasury Secretary Scott Bessent cautioned on Sunday that Washington could reinstate higher levies if Beijing backtracked or restricted critical exports again.
The improved diplomatic tone has provided relief to markets shaken by the trade turbulence earlier this year, when new tariffs triggered a sharp global selloff.
Fed Rate Cut and AI Boom Fuel Risk Appetite
Global equities have rallied sharply since the Federal Reserve’s latest rate cut, which reinforced expectations that U.S. policymakers are committed to supporting growth.
“The combination of a friendlier Fed, lower tariffs, and strong AI-driven corporate performance is exactly what traders needed to regain confidence,” said Chris Weston of Pepperstone.
He added, however, that political gridlock in Washington could soon weigh on sentiment as the U.S. government shutdown drags on, with Democrats and Republicans still unable to agree on a reopening deal.
“The shutdown could soon feasibly become the longest on record, though markets remain largely unperturbed,” Weston noted.
“But frustration will rise this week as food benefits pause, domestic travel faces delays, and Affordable Care Act enrollments become increasingly problematic.”
Commodities and Currencies
Oil prices edged higher after OPEC+ confirmed plans to pause output increases during the first quarter of 2026, extending its production freeze to stabilize markets amid softening global demand.
- Brent crude rose 0.8% to $65.26 per barrel.
- West Texas Intermediate (WTI) gained 0.8% to $61.44.
Meanwhile, gold hovered around $4,000 per ounce, down from a record $4,381 reached on October 20. The decline followed China’s decision to scrap a tax incentive for gold purchases, prompting profit-taking after a 60% year-to-date surge.
On the currency front:
- Euro/dollar rose to $1.1540 (from $1.1527 Friday).
- Pound/dollar increased slightly to $1.3147.
- Dollar/yen traded at ¥154.20.
- Euro/pound edged up to 87.78 pence.
Wall Street Recap and EuropeanOutlook
In New York on Friday:
- The Dow Jones Industrial Average added 0.1% to 47,562.87.
- The S&P 500 and Nasdaq Composite also posted modest gains, closing near all-time highs on the back of robust tech performance.
In Europe, London’s FTSE 100 fell 0.4% to 9,717.25, with energy and mining stocks under pressure from weaker commodity demand forecasts.
Outlook: All Eyes on U.S. Jobs Data
Investors are now turning attention to upcoming U.S. employment data, a key gauge of economic momentum and a possible indicator of future Fed policy moves.
However, uncertainty remains over whether government agencies will release the report on schedule due to the ongoing federal shutdown.
Despite political and supply chain risks, analysts say market sentiment remains broadly constructive heading into November — supported by the AI sector boom, easing global tensions, and continuing central bank support.
