Asian Markets Surge Amidst Chinese Stimulus and Global Disinflation Signals

Chinese stocks had their best week since 2008, lifting Asian shares to multiyear highs. Beijing's large stimulus package aimed at reviving the economy spurred gains across Asian markets, while a steep fall in oil prices points to global disinflation. The Japanese yen dropped as markets speculated on the outcome of Japan's leadership contest.

Chinese stocks experienced their most significant weekly rise since 2008, lifting Asian shares to their highest levels in 2-1/2 years. This surge was driven by Beijing's introduction of a substantial stimulus package designed to rejuvenate the economy. Concurrently, oil prices plummeted, providing a promising signal for global disinflation.

The Japanese yen also saw a decline, falling 1% to three-week lows. This drop came as markets speculated that Sanae Takaichi, Japan's economic security minister who opposes interest rate hikes, might win the leadership contest of the ruling Liberal Democratic Party. Such an outcome could impact Japan's monetary policy stance.

Meanwhile, European stocks were set for a positive opening, with slight gains reported for EUROSTOXX 50 and FTSE futures. Wall Street futures remained largely unchanged. The day saw MSCI's broadest index of Asia-Pacific shares outside Japan climb 0.5%, reaching its highest point since February 2022.

(With inputs from agencies.)