Asian markets climbed Monday as investors positioned ahead of a planned meeting between U.S. President Donald Trump and Chinese leader Xi Jinping in Washington this week. U.S. Treasury Secretary Scott Bessent described Sunday's preparatory talks with Chinese Vice Premier He Lifeng in New York as "a very successful engagement," lifting futures and signaling potential progress on trade and technology discussions.
The talks touched on reciprocal tariff reductions covering an estimated $30 billion in goods, alongside artificial intelligence cooperation. China's Foreign Ministry confirmed Xi will pay a state visit to the U.S. from September 23 to 25. Trade, tariffs, and AI safety are expected to dominate the agenda, with the war in Iran and Middle East tensions also likely to surface.
Tech and chip stocks ride AI momentum
Technology shares across Asia gained ground despite calls from some American tech leaders for a slowdown in AI development over safety concerns. South Korea's Kospi rose 1.7% to 7,007.72, with Samsung Electronics jumping 5% and memory chipmaker SK Hynix adding 0.6%. Taiwan's Taiex advanced 1.1% as TSMC, a leading AI chip manufacturer, climbed 0.8%.
Hong Kong's Hang Seng gained 0.9% to 24,975.58, and the Shanghai Composite index rose 1% to 3,949.91. Markets in Japan were closed for holidays through Wednesday. Australia's S&P/ASX 200 was nearly flat at 8,731.90, while India's Sensex added 0.7%.
Oil retreats as Hormuz traffic picks up
Oil prices fell more than 2% early Monday as vessel traffic through the Strait of Hormuz increased, though the waterway remains largely closed and U.S.-Iran tensions persist. Brent crude, the international benchmark, dropped 2.1% to $101.65 per barrel. Benchmark U.S. crude lost 2.3% to $93.86 per barrel. Both grades have surged since late February, when Brent traded near $72.
ING commodities strategists Ewa Manthey and Warren Patterson wrote that profit-taking after the recent price spike, combined with "hopes for constructive discussions" at the upcoming U.N. General Assembly and the Trump-Xi meeting, helped improve market sentiment. Supply concerns remain elevated, with Saudi Arabia's closure of a key oil pipeline and tensions involving Iran-backed Houthis adding pressure to global supplies.
Bond yields and currency moves
The yield on the U.S. 10-year Treasury hovered near 4.97% early Monday, after hitting 5% last week when the Federal Reserve raised rates for the first time in three years. The Bank of Japan also lifted rates to a 31-year high. Government bond yields have stayed elevated due to inflationary pressure from the energy shock and rising U.S. national debt.
The U.S. dollar strengthened to 157.25 Japanese yen from 156.81 yen. The euro slipped to $1.1473 from $1.1483. On Friday, Wall Street's S&P 500 added 0.2%, the Dow Jones Industrial Average edged down 0.2%, and the Nasdaq composite gained 0.4%.
Why this matters for finance professionals
The Trump-Xi meeting carries direct implications for tariff exposure, supply chain costs, and currency positioning. Reciprocal tariff reductions on $30 billion in goods would shift earnings forecasts for import-dependent sectors. Simultaneously, oil price swings tied to Strait of Hormuz disruptions and Middle East instability demand close attention from anyone managing energy-linked portfolios or inflation-sensitive assets. The convergence of trade policy, commodity shocks, and central bank rate moves this week creates a compressed window for repricing risk across equities, bonds, and FX.
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