Investing.com — Most Asian stocks rose on Monday, following gains on Wall Street after softer U.S. inflation data spurred bets that interest rates will fall further next year.
Japanese stocks were among the day's best performers, buoyed by speculation about a possible midterm merger Honda (NYSE:) and Nissan (OTC:), as reports said a deal was imminent.
Regional markets took positive signs from Wall Street, which surged on Friday after data- the Federal Reserve's preferred inflation gauge- read softer than expected in November. The reading helped ease concerns that US rates will fall at a slower pace in 2025, especially after the Fed struck a hawkish tone during a meeting last week.
US stock futures rose in Asian trade, also supported by hopes for the US government to avoid a shutdown.
Japanese shares rise amid reports of Honda-Nissan merger
Japan and the indices rose by 0.9% and 0.5%, respectively.
Gains in the Japanese market came amid increased focus on Honda Motor Co Ltd (TYO: ) and Nissan Motor Co., Ltd. (TYO:), after a report from public broadcaster NHK said a preliminary agreement would be signed later on Monday, with the aim of finalizing the terms of the merger by June 2025.
Honda rose nearly 2%, while Nissan fell slightly after rallying nearly 20% last week. Mitsubishi Motors Company (TYO:), which could also be pulled from the merger, rose 2.8%.
The merger has the potential to make the world's third-largest automaker by sales, and is seen as a rival to Honda and Nissan with increased competition and soft sales, especially in China's high-end car market.
Despite speculation about a merger, the focus is on Japanese markets again on key inflation data for November released on Friday. The reading showed that inflation picked up more than expected in November, keeping expectations of an interest rate hike by the Bank of Japan evenly in play.
Asian stocks rise on focus on US rates, China stimulus
Broader Asian markets advanced on Monday amid hopes of softer US inflation, although most regional markets were still running losses last week.
Australia rose 1.2%, with local News Corp (ASX:) (NASDAQ:) shares rising 2.2% after the firm said it would sell television broadcaster Foxtel to British sports streamer DAZN Group for a $3.4 billion ($2.1 billion).
China and the indexes rose 0.6% and 0.2%, respectively, while the Hong Kong index added 0.5%.
Chinese markets have been sitting on some gains in recent sessions after Beijing gave more assurances that it will increase fiscal spending in 2025 to support economic growth.
South Korea added 1.5% and was the region's best performer, as investors bought into stocks that were heavily discounted after domestic markets were rocked by political uncertainty earlier this month.
Singapore rose 1.1%, with Talkmed Group Ltd (SGX:) is rallying nearly 6% after receiving an offer to be taken private.
Singapore Post Ltd (SGX:) slid 8% after it fired its CEO Phang Heng Wee for misconduct.
on the Indian index pointed to a soft open, after the index fell sharply last week.