Global Markets Brace for Central Bank Decisions Amid Growing Uncertainty

Asian markets rebounded as investors anticipate a week filled with critical earnings reports and central bank decisions from the U.S., UK, and Japan. The U.S. Federal Reserve is expected to hint at a future rate cut while China's politburo meeting could signal more economic stimulus. Additionally, the Middle East conflict has nudged oil prices higher, amidst mixed movements in other commodities.

Asian shares rebounded on Monday as investors brace for a week dense with earnings reports and critical central bank meetings, including potential policy shifts in the United States, United Kingdom, and Japan. The fluctuations in oil prices reflect heightened tensions in the Middle East, notably following a rocket strike in the Israeli-occupied Golan Heights, attributed to Hezbollah by the U.S. and Israel.

This week also brings the U.S. jobs report for July, coupled with essential surveys on U.S. and global manufacturing, and crucial data on the Eurozone's GDP and inflation. Market anticipation is focused on the Federal Reserve's policy meeting on Wednesday, which is expected to set the stage for a possible rate cut in September. Futures pricing suggests a quarter-point easing is already factored in, with a smaller chance for a more significant cut.

Meanwhile, the Bank of Japan's upcoming meeting is expected to result in a rate hike, while the Bank of England's decision remains uncertain. Market movements indicate a 51% probability of a rate cut to 5%. The mixed backdrop of higher borrowing costs in Japan weighed on the Nikkei, leading to a modest rebound this week.

(With inputs from agencies.)