Asian Stocks Surge on US-China Trade Deal Optimism

Asian stock markets surged amid optimism over a potential US-China trade deal, with major indices in Japan, South Korea, Taiwan, China, and Hong Kong reaching record or multi-year highs. This positive momentum followed statements from US and Chinese officials indicating a preliminary consensus on tariffs, export controls, and cooperation on fentanyl, setting the stage for a face-to-face meeting between President Donald Trump and Chinese leader Xi Jinping in South Korea. Investors' risk appetite was further boosted by softer-than-expected US inflation data, which raised expectations of Federal Reserve interest rate cuts. President Trump expressed confidence in securing a comprehensive trade deal, also highlighting potential agreements on issues like TikTok and regional defense investments with Japan. While most Asian markets advanced, Indonesia's shares fell sharply due to less attractive government bonds and narrowing yield premiums compared to US Treasuries. Overall, these developments have fostered a broadly bullish outlook for Asian equities and currencies ahead of key central bank decisions and tech earnings reports.