Most Asian markets rose today, building on last week’s rally following the Federal Reserve’s bumper interest rate cut, while sentiment was also boosted by hopes for fresh measures to kickstart China’s economy.

Also oil prices edged up on worries about an escalation of the conflict in the Middle East after Lebanon-based Hezbollah launched dozens of rockets at Israel, with both sides threatening to ramp up hostilities.

Shanghai, Seoul, Singapore, Taipei, Mumbai, Jakarta and Manila rose, though Hong Kong, Sydney, Bangkok and Wellington dipped.

Stocks in Colombo fell after self-avowed Marxist, Anura Dissanayaka, won Sri Lanka’s presidential election, fueling worries about a $2.9 billion International Monetary Fund bailout that demands steep tax hikes and other austerity measures.

London and Frankfurt rose but Paris dipped.

Tokyo was closed for a holiday.

Traders greeted the first reduction in borrowing costs since 2020 by pushing the Dow and S&P 500 to record highs as they contemplated a soft landing for the world’s top economy.

Youth unemployment in China hit 18.8 per cent in August, its highest level this year, as leaders struggle to kickstart growth and face calls for more stimulus — particularly for the troubled property sector.

A decision by the country’s central bank to cut its 14-day lending rate also provided some support to markets Monday, with investors also hoping for more growth-boosting measures.

The report came after news earlier in the month pointed to a slowdown in retail sales and industrial production growth for August.

“As the property market struggles and the unemployment rate creeps up, households are being cautious with their spending,” said Moody’s Analytics.

“Government measures to stimulate domestic demand have yet to encourage households to spend.”

Eyes are now on the release this week of the personal consumption expenditures index, the Fed’s preferred inflation metric, which could guide policymakers’ decision-making on the next rate move.

Fed boss “Jerome Powell signaled a tentative victory in the battle against inflation, noting that the risks of inflation escalating further have ‘diminished’”, wrote IG analyst Tony Sycamore.

“The focus of monetary policy has now distinctly shifted towards supporting the labor market to ensure a smooth economic landing, evidenced by the substantial 50-basis-point cut.”

Oil prices edged up on worries about an escalation of the conflict in the Middle East after Lebanon-based Hezbollah launched dozens of rockets at Israel, with both sides threatening to ramp up hostilities.

Today, Israel carried out a series of strikes in Lebanon’s south and the military warned Lebanese to move away from Hezbollah targets. The yen edged up against the dollar after sinking Friday in reaction to the Bank of Japan’s decision not to hike interest rates for a third time this year which suggested it was not in a rush to tighten policy further.

Gold sat around record highs of around $2,650 after the Fed rate cut, which makes the precious metal more attractive to traders, and on geopolitical concerns.

– Key figures around 0810 GMT –

Hong Kong – Hang Seng Index down 0.1 per cent at 18,247.11 (close)

Shanghai – Composite rose 0.4 per cent at 2,748.92 (close)

London – FTSE 100 increased by 0.4 per cent at 8259.88

Tokyo – Nikkei 225 closed losed for a holiday

Pound/dollar was down at $1.3284 from $1.3316 on Friday

Euro/dollar was down at $1.1100 from $1.1160

Dollar/yen: down at 143.70 yen from 144.02 yen

Euro/pound crashed to 83.71 pence from 83.80 pence

West Texas Intermediate rose 0.1 at $71.10 per barrel

Brent North Sea Crude increases by 0.2 per cent at $74.60 per barrel

New York – Dow rose 0.1 per cent at 42,063.36 (close)

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