On Monday (4th), the Asia-Pacific stock markets generally rose as the market expected that the U.S. presidential election would bring policy adjustments that could have a profound impact on the global economy and financial markets. The South Korean KOSPI index ended a three-day decline, surging 1.25% and leading the Asia-Pacific stock markets. In addition, the Hong Kong Hang Seng Tech Index rose by 1.13%, and the Taiwan Weighted Index also moved higher, while the Japanese stock market was closed due to a holiday.
The U.S. presidential election has attracted heightened global market attention, with analysts pointing out that the U.S. may undergo significant policy adjustments, particularly in fiscal stimulus and monetary policy, which has investors closely watching the Federal Reserve's future decision-making direction. The market generally expects that after the election, the Federal Reserve will cut interest rates by 25 basis points to support economic recovery and alleviate financial market volatility. Market participants believe the Federal Reserve may implement more easing measures within the year to support economic recovery and further stimulate the Asia-Pacific and global investment environment.
Goldman Sachs analysts pointed out that investors might be overly concerned about the market uncertainty caused by a delayed election result. Although market participants have anticipated some tail risk from the "protracted" election result, Goldman believes that financial markets have sufficient adaptability to digest the election results on election night or the following morning.
Against this backdrop, the general strength of the Asia-Pacific stock markets reflects global investors' optimistic expectations about future U.S. policies. Despite challenges to U.S. economic recovery, particularly in the context of high inflation and slowing growth, investors expect new fiscal stimulus policies to support the global economy, thereby providing upward momentum for the Asia-Pacific markets.
