Asian stocks rise as weak U.S. jobs data eases Fed hike bets; Japan surges

Investing.com -- Asian stocks rose on Monday as softer U.S. labor data reduced expectations for further Federal Reserve rate hikes, lifting technology shares and easing pressure on bonds.

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Japan led the region higher, with the Nikkei 225 jumping 2.5% to 69,986 and the TOPIX gaining 1.4% to 4,146.76. South Korea and mainland China remained closed for public holidays, while Hong Kong's Hang Seng was little changed at 23,981.50.

The backdrop from Wall Street remained supportive, although U.S. futures were softer in Asian trade. The Nasdaq 100 had closed at a record high on Friday, while Nasdaq 100 Futures fell 0.1% to 31,037.75 and S&P 500 Futures also slipped 0.1% to 7,768.75.

The retreat followed Friday's U.S. jobs report, which showed employers added fewer workers than expected in September and wage growth slowed, prompting money markets to price in less than a 25% chance of an October Fed hike.

Treasuries also remained supported, with the U.S. 10-year Treasury yield falling two basis points to 5.25%. The reprieve followed a prolonged bond selloff driven by persistent inflation concerns, government spending and heavier corporate borrowing to fund the artificial-intelligence buildout.

Japan's Nikkei 225 jumped 2.6%, while the TOPIX gained 1%, as technology shares benefited from the broader improvement in risk appetite. The rally comes as investors reassess the interest-rate outlook following the softer U.S. employment data.

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TSMC rose around 3% on reports of a potential collaboration with Elon Musk's Terafab, adding to the strength across the regional semiconductor sector. The gains also followed a record close for the Nasdaq 100 on Friday, reinforcing optimism around the broader AI trade.

Japan's gains extended beyond semiconductors. Nippon Paint shares rose 1% after the company agreed to acquire Akzo Nobel's Southeast Asian unit in a deal valued at $1.35 billion, highlighting renewed corporate activity alongside the broader market rally.

Elsewhere, Hong Kong's Hang Seng edged higher, while Singapore's Straits Times gained 0.3%. Australia's S&P/ASX 200 and New Zealand's NZX 50 traded flat.

India's Nifty 50 rose to 22,430.70. The S&P BSE Sensex rose 0.1% to 71,961.20, while the broader Nifty Smallcap 250 fell 0.1%.

Oil gave back an early advance, with Brent crude for December delivery falling 0.6% to around $101.60 a barrel after climbing above $103 earlier in the session.

Prices had initially risen after Saudi-backed forces in Yemen launched an operation to retake territory controlled by the Iran-aligned Houthis.

The retreat came as markets weighed the possibility that the latest developments could alter regional supply risks, while investors continued to assess how the conflict could affect energy flows.

The combination of softer U.S. labor data, lower bond yields and a renewed technology rally has improved risk appetite across Asia, although elevated long-term yields, European bond-market concerns and geopolitical risks continue to leave markets vulnerable to renewed volatility.

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