A profound divergence is splitting the global financial world, as a powerful, record-setting rally on Wall Street—a market that has brazenly shrugged off the threat of a US government shutdown—fails to inspire a cautious and splintered Asia.
Instead of following America’s lead, the region is marching to the beat of its own drum, a rhythm dictated by a disappointing economic signal from Japan, a surge to a new record high for gold, and the tense anticipation of a pivotal central bank decision in India.
Overnight, the Dow Jones Industrial Average climbed to a fresh closing high, with US investors seemingly unperturbed by the political chaos in Washington.
But that bullish conviction has failed to cross the Pacific.
A disappointing dawn in Tokyo
The most significant drag on regional sentiment is coming from Japan, where the Nikkei 225 has sunk 1.16 percent and the broader Topix has fallen 1.71 percent.
The sell-off was triggered by the release of the central bank’s closely-watched Tankan survey, a key measure of business sentiment.
While optimism among large manufacturers ticked slightly higher, it fell short of economists’ forecasts, a subtle but significant disappointment that has poured cold water on the market.
A tech-fueled rally, a golden warning
In a stark contrast to Japan’s gloom, technology shares are providing a powerful tailwind elsewhere.
The Taiwan Weighted Index is leading the gains in Asia, soaring 1.14 percent, a rally powered by a 2.3 percent jump in the chip heavyweight TSMC after the AI darling Nvidia topped a staggering 4.5 trillion dollar market cap.
This tech-led optimism has also lifted South Korea’s Kospi, which is up 0.79 percent.
But even as tech stocks rally, a powerful warning signal is flashing in the commodities market.
Spot gold prices have surged to a fresh all-time record of 3,875.32 dollars an ounce, a clear sign that beneath the surface of the equity rally, a deep undercurrent of anxiety persists.
Dalal Street holds its breath
This complex and conflicting picture has set the stage for a day of high drama on Dalal Street.
The Indian stock market has opened flat, with the Sensex down a marginal 0.12 percent and the Nifty up just 0.04 percent, as the entire nation holds its breath for the Reserve Bank of India’s monetary policy announcement.
The verdict from the central bank is far from certain. While most economists expect the RBI to hold rates steady, a vocal minority, including the influential State Bank of India, is projecting a potential 25-basis-point cut.
This deep division of opinion has left the market in a state of suspended animation, waiting for a clear signal to break the deadlock and set the course for the coming weeks.
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