China Stimulus Boosts Asian Stocks While US Faces Recession Worries

China Stimulus Boosts Asian Stocks While US Faces Recession Worries

Oil Prices Climb Amid Geopolitical Tensions

Oil prices surged on Monday, driven by geopolitical concerns and expectations of increased demand from China. Brent crude futures rose 1.06% to $71.33 per barrel, while U.S. West Texas Intermediate (WTI) crude climbed 1.12% to $67.94 per barrel.

Market analyst Tony Sycamore noted, “If crude oil gets much above $68.50, that could trigger short covering in the market.”

China’s Economic Stimulus Fuels Optimism

China’s State Council announced measures to boost domestic consumption, including increasing residents’ income and establishing a childcare subsidy scheme. This follows a recent commitment by financial regulators to ease consumer credit conditions and loan terms.

Lynn Song, chief economist for Greater China at ING, commented, “There is considerable focus on increasing both the capacity and willingness of households to consume.”

China’s industrial output exceeded expectations, rising 5.9% year-over-year in the first two months of 2025. However, property investment remained a drag on growth.

Asian Markets Gain Ground

Asian stock markets reacted positively to China’s stimulus measures. The Shanghai Composite Index gained 0.28%, while Hong Kong’s Hang Seng Index advanced more than 0.8%. The MSCI Asia-Pacific index outside Japan rose 1% to a one-week high.

U.S. Futures Decline Amid Economic Uncertainty

In contrast to Asia, U.S. stock futures signaled a weak opening. Nasdaq futures fell 0.44%, while S&P 500 futures declined 0.4%.

Investor concerns grew after U.S. Treasury Secretary Scott Bessent stated there were “no guarantees” that the U.S. would avoid a recession. President Donald Trump also refrained from making predictions regarding the economy amid ongoing trade tensions.

“When you have both the President and the Treasury Secretary unwilling to rule out a recession, it suggests potential turbulence ahead,” said Sycamore.

European Markets and the Euro Show Strength

European stock futures pointed to slight gains. EUROSTOXX 50 futures rose 0.2%, and FTSE futures advanced 0.36%.

Germany’s newly approved fiscal plan, which includes a 500 billion euro ($540 billion) investment in infrastructure and revised borrowing rules, has provided support to European markets. The euro held near a five-month high, trading at $1.0882.

Currency and Commodity Movements

The U.S. dollar remained weak, down over 4% for the year, amid investor concerns about U.S. economic policy. The yen held firm at 148.59 per dollar, ahead of the Bank of Japan’s policy meeting, where rates are expected to remain unchanged.

Gold hovered near record highs, last trading at $2,991 per ounce, after surpassing the $3,000 barrier for the first time on Friday as investors sought safe-haven assets.

“China Stimulus Boosts Asian Stocks While US Faces Recession Worries” “China Stimulus Boosts Asian Stocks While US Faces Recession Worries” “China Stimulus Boosts Asian Stocks While US Faces Recession Worries”