Asia markets advance as odds for another Fed rate cut grow

Recent remarks from senior Fed policymakers suggest that labour-market conditions are becoming an increasing concern for the central bank and that further policy easing is actively being considered. Analysts observed that the Fed’s leadership has not opposed these signals, indicating widespread support within the institution for another cut at the December 9–10 meeting. Market expectations now reflect roughly a 90 per cent chance of a reduction, significantly higher than the expectations from the previous week.

Market records

US markets responded positively, with Wall Street recording its second consecutive strong session. The S&P 500 rose around 1.6 per cent, while the Nasdaq increased 2.7 per cent, supported by large technology firms including Alphabet, Meta, and Amazon. The rebound followed recent concerns over inflated valuations in the AI sector, which had triggered a series of sell-offs earlier in the month. Analysts now suggest the market is shifting towards a more selective approach that prioritises earnings strength and long-term sustainability over broad thematic enthusiasm.

The positive sentiment extended into Asia, with Hong Kong, Shanghai, Seoul, Taipei, Manila and Jakarta all posting gains, capitalising on Monday’s momentum. Sydney, Singapore and Wellington experienced slight declines.

Market confidence was further boosted by signals of improving US–China relations after President Donald Trump and President Xi Jinping held a phone call described as constructive by officials from both sides. The two leaders are expected to exchange visits in 2026, helping to create a more stable environment for regional trade discussions.