Asian shares track Wall Street's rally after Powell hints at rate cuts
[August 25, 2025] By
ELAINE KURTENBACH
BANGKOK (AP) — Asian shares advanced on Monday, tracking Wall Street’s
rally after the head of the Federal Reserve hinted that cuts to interest
rates may be on the way.
Fed chair Jerome Powell said Friday in a speech to an annual conference
in Jackson Hole, Wyoming, that he's seen risks for the job market. That
followed a surprisingly weak report on job growth this month that has
led many traders to expect a rate cut as soon as the Fed's next meeting
in September, after months of pressure from President Donald Trump for
lower rates.
Lower interest rates make borrowing easier, helping to spur more
investment and spending.
Hong Kong's Hang Seng index was 1.9% higher at 25,807.45, while the
Shanghai Composite index surged 1.5% to 3,883.56. It's trading at its
highest level in a decade, despite worries over higher tariffs on
exports to the United States under Trump and weak domestic demand at
home.
Taiwan's Taiex gained 2.2% as semiconductor maker TSMC Corp.'s shares
advanced 3.1%.
Tokyo's Nikkei 225 gained 0.4% to 42,807.82, with computer chip-related
companies leading gains.
The Kospi in South Korea climbed 1.3% to 3,209.86.
Australia's S&P/ASX 200 edged less than 0.1% higher, to 8,972.40.
The SET in Bangkok gained 0.9%, while the Sensex in India rose 0.5%.
“Asia is set to rally in catch-up mode, feeding off Wall Street’s Friday
rebound after Powell cracked the door open to rate cuts,” Stephen Innes
of SPI Asset Management said in a commentary.
This week, Nvidia's earnings report, due Wednesday after markets on Wall
Street close, is a key focus of attention.
Nvidia's role as a key supplier of chips for artificial intelligence and
its heavy weighting give it outsized influence as a bellwether for the
broader market.
On Friday, the S&P 500 leaped 1.5% for its first gain in six days,
closing at 6,466.91. That's just shy of its all-time high set last week.
The Dow Jones Industrial Average soared 846 points, or 1.9%, to its own
record of 45,631.74. Nasdaq composite jumped 1.9% to 21,496.53.
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A dealer watches computer monitors near screens showing the Korea
Composite Stock Price Index (KOSPI) at a dealing room of Hana Bank
in Seoul, South Korea, Monday, Aug. 25, 2025. (AP Photo/Lee Jin-man)
 Investors love lower interest rates,
even if they risk adding to inflation.
Stocks of smaller companies led the way. They can benefit more from
lower interest rates because of their need to borrow money to grow.
The smaller stocks in the Russell 2000 index surged 3.9% for its
best day since April.
Still, Powell did not commit to any kind of timing. He said the job
market looks OK, even if “it is a curious kind of balance” where
fewer new workers are chasing after fewer new jobs. Inflation,
meanwhile, still has the potential to push higher.
The yield on the 10-year Treasury fell to 4.25% from 4.33% late
Thursday. The two-year Treasury yield, which more closely tracks
expectations for Fed action, sank to 3.69% from 3.79% in a notable
move for the bond market.
Intel climbed 5.5% after Trump said the chip company has agreed to
give the U.S. government a 10% stake in its business.
Nvidia rose 1.7% to trim its loss for the week. The company, whose
chips are powering much of the world’s move in to
artificial-intelligence technology, had seen its stock struggle
recently amid criticism that it and other AI superstars shot too
high, too fast and became too expensive.
In other dealings early Monday, U.S. benchmark crude oil gained 10
cents to $63.77 per barrel. Brent crude, the international standard,
added 7 cents to $67.29 per barrel.
The U.S. dollar rose to 147.33 Japanese yen from 146.88 yen. The
euro fell to $1.1703 from $1.1727.
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