Having followed Monday's listless start to the quarter with a 0.5% decline on Tuesday, Asian stocks are poised to rebound on Wednesday thanks to a triple-boost from tech-fueled rise in U.S. and global stocks, falling Treasury yields and a weaker dollar.
Tuesday's market-friendly conditions were in large part laid by Federal Reserve Chair Jerome Powell's comments at the ECB's annual policy conference in Sintra, Portugal. While the Fed needs more data before cutting interest rates, the U.S. is back on a "disinflationary path," Powell said. The tech sector was a solid performer on Wall Street again, with Tesla shares up 9% to a fresh six-month high and bringing the gains so far this week up to 15%. Having significantly lagged most Big U.S. Tech this year, they are on track for their best week in 18 months.
Strength across the broader tech complex and especially in mega caps pushed the NYSE FANG index to another record high on Tuesday. Can this feelgood factor spread to Asia? It hasn't lately, and Asian tech has underperformed badly in recent weeks.The Hang Seng tech index fell again on Tuesday - its seventh decline in eight sessions - to its lowest since April 24. It has lost 15% since mid-May, in which time the S&P info tech index has risen 15%.