Asian equity markets opened lower on Tuesday, retreating from the record highs set on Monday, as investors brace for a week packed with major technology earnings reports and a crucial Federal Reserve meeting.

Market Performance

The S&P 500 in the United States closed at a new record, surpassing 6,875.00 points in its strongest three-day rally since May. This sets a stark contrast to the Asian markets' opening performance.

Tech Earnings in Focus

Investors are keenly awaiting earnings reports from five major technology companies that collectively account for about a quarter of the US benchmark index:

Notably, reports suggest that Amazon may be planning to cut as many as 30,000 jobs, a move that could significantly impact its financial outlook.

Other Market Movements

• Gold: Experienced a sharp decline, falling more than 3% to trade below $4,000.00 an ounce.
• US Dollar: Edged lower against major currencies.

Key Events to Watch

1. Federal Reserve Meeting: Investors are looking to the upcoming Fed meeting for guidance on potential interest rate cuts.

2. US-China Trade Relations: Trade tensions between the two economic giants showed signs of easing, with officials unveiling agreements and former President Trump expressing optimism about a potential deal.

3. Tech Sector Developments: Qualcomm shares rose to their highest price in 15 months after unveiling AI data center chips, potentially challenging Nvidia's dominance in the sector.

As global markets navigate through these developments, investors will be closely monitoring how Asian markets respond to the upcoming tech earnings and central bank decisions in the coming days.

Asian stock markets experienced a significant rally, with overall Asian stocks rising by 0.8% as positive signs emerged regarding a potential trade deal between the United States and China. The news sparked optimism across various asset classes, impacting stocks, commodities, and currencies.

Stock Market Performance

Asian markets showed strong performance, with Japan and South Korea leading the charge:

Commodity and Currency Movements

The positive sentiment extended beyond equities, affecting commodities and currencies:

The Australian and New Zealand dollars, often seen as proxies for China-exposed currencies, strengthened on the news.

Bond Market Reaction

The optimism in the stock market had an inverse effect on the bond market:

US-China Trade Negotiations

The rally was primarily driven by developments in US-China trade talks:

• US negotiators and Chinese officials reached preliminary consensus on key issues
• Two-day talks were held in Malaysia
• Areas of agreement included:
  1. Export controls
  2. Fentanyl
  3. Shipping levies

Looking Ahead

Investors are now turning their attention to a busy week ahead:

1. Federal Reserve rate decision
   • Forecast: 25 basis point rate cut
2. Earnings reports from major tech companies
   • Apple
   • Microsoft
3. Other central bank decisions
   • European Central Bank (ECB): Expected to maintain current rates
   • Bank of Japan (BOJ): Expected to maintain current rates

This positive development in US-China trade relations, coupled with anticipated central bank decisions and major earnings reports, sets the stage for a potentially eventful week in global financial markets.