Federal Reserve Rate-Cut Expectations Boost Markets Ahead of Decisions

Asia-Pacific markets experienced notable gains as they tracked Wall Street's performance, driven by rising expectations that the U.S. Federal Reserve may cut benchmark interest rates in December. According to CNBC, these expectations were bolstered by a report from Bloomberg indicating that White House National Economic Council Director Kevin Hassett is a leading candidate to become the next Fed chair.

Investors perceive Hassett as more inclined to advocate for a lower-rate environment, aligning with the preferences of President Donald Trump. Treasury Secretary Scott Bessent mentioned to CNBC that there is a 'very good chance' Trump could appoint a new Fed chair before Christmas.

The CME FedWatch tool indicates that markets are pricing in over an eighty-four percent likelihood of a rate cut in December. New York Fed President John Williams also hinted at the potential for rate reductions 'in the near term.' In Japan, the Nikkei 225 index surged one point eighty-five percent to close at forty-nine thousand five hundred fifty-nine point zero seven, with gains led by the utilities, real estate, and financial sectors.

Notable movers included Toppan Holdings, up six point twenty-seven percent, and SoftBank Group, which rose five point sixty-five percent. The Topix index climbed nearly two percent to three thousand three hundred fifty-five point five.

However, Kioxia shares plummeted fourteen point eighty-nine percent following reports of Bain Capital's plans to sell approximately three hundred fifty billion yen worth of shares, reducing its stake from fifty-one percent to forty-four percent.

In South Korea, the Kospi index advanced two point sixty-seven percent, closing at three thousand nine hundred sixty point eighty-seven, while the small-cap Kosdaq rose two point forty-nine percent to eight hundred seventy-seven point thirty-two.

In Australia, the ASX/S&P 200 index closed zero point eighty-one percent higher at eight thousand six hundred six point five, despite inflation accelerating in October to three point eight percent year-over-year, the fastest growth in seven months.

In Hong Kong, the Hang Seng Index increased by zero point thirty-eight percent, while mainland China's CSI 300 gained zero point sixty-one percent to close at four thousand five hundred seventeen point sixty-three.

Taiwan's Taiex index rose one point eighty-five percent to twenty-seven thousand four hundred nine point fifty-four. Conversely, shares of Bharti Airtel in India fell two point two percent amid reports of its promoter planning to sell thirty-four point three million shares in bulk deals worth at least eight hundred six million dollars.

This surge in expectations for a Federal Reserve rate cut highlights the interconnectedness of global financial markets and the significant influence of U.S. monetary policy on international economies.