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Asia-Pacific stock markets opened higher on Friday, diverging from their counterparts in Wall Street, which experienced a decline during the first trading session of 2025, largely impacted by struggles in the technology sector.
According to a report by the Financial Times, the People’s Bank of China is contemplating a reduction in interest rates this year “at an appropriate time.” Currently, the 7-day reverse repo rate stands at 1.5%.
In related news, China’s commerce ministry has announced plans to enforce export limitations on various technologies utilized in producing battery components and processing essential minerals such as lithium and gallium. This was detailed in a notice issued on Thursday.
In South Korea, investors are closely monitoring the political landscape, where the country’s anti-corruption agency is pursuing an arrest warrant for the impeached President Yoon Suk Yeol. His recent attempt at martial law on December 3 has plunged the nation into political chaos, as reported by local media Yonhap News.
Despite these challenges, South Korea’s Kospi index registered a 1.41% increase, while the smaller-cap Kosdaq rose by 1.33%. Meanwhile, Australia’s S&P/ASX 200 opened up by 0.28%.
Contrarily, futures for Hong Kong’s Hang Seng index indicated a drop, currently at 19,610, falling short of its last close of 19,623.32. Japan’s markets remained closed for a holiday, leading to reduced activity in that region.
In the U.S., the first trading day of the year concluded with all three major indexes falling, indicating a continuation of the downward trend seen at the end of 2024. This situation has raised questions about the potential for a “Santa Claus rally,” traditionally a period of market gains during the last five trading days of December and the first two days of January. Historically, this period has yielded an average increase of 1.3% in the S&P 500, with a high probability of closing positively, according to Dow Jones Market Data since 1950.
In the most recent trading session, the Dow Jones Industrial Average lost 151.95 points, a drop of 0.36%, ending at 42,392.27. The S&P 500 fell by 0.22% to close at 5,868.55, while the Nasdaq Composite experienced a 0.16% decrease, ending at 19,280.79. This marked the S&P 500 and Nasdaq’s fifth consecutive losing session, their longest streak of losses since April, driven largely by declines in major tech stocks such as Apple, which dropped 2.6%, and Tesla, which saw a significant 6% decline due to lower annual delivery figures.
— CNBC’s Jesse Pound and Christina Cheddar Berk contributed to this report.
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