Asian stock markets surged on Monday, led by strong gains in Chinese and Indian equities following two major geopolitical developments: the announcement of a US-China trade deal and a ceasefire between India and Pakistan. Both events fueled optimism across financial markets, even as pharmaceutical stocks weighed on some regional indexes.
US-China Trade Deal Fuels Market Optimism
Chinese markets saw the strongest performance in the region. The Shanghai Composite rose by 0.9%, while the CSI 300 jumped 1.1%. Hong Kong’s Hang Seng Index outperformed with a 1.5% surge.
Officials from both nations confirmed that a preliminary trade agreement had been reached during high-level talks in Geneva. Although details are pending, US President Donald Trump hinted at a potential reduction in tariffs on Chinese goods—down from 145% to possibly 80%.
This development marks a significant easing in trade tensions between the world’s two largest economies, boosting confidence in global growth and lifting US stock index futures in Asian trading. The Nasdaq 100 Futures (NQM25) rose nearly 2%, while S&P 500 Futures gained 0.5%.
India-Pakistan Ceasefire Sends Nifty 50 Soaring
The Nifty 50 Index in India rallied nearly 3% in early trade, rebounding from prior losses caused by military escalations with Pakistan. The ceasefire, reportedly brokered by the US, appeared to hold on Sunday, reducing tensions in the disputed Kashmir region.
While India remains cautious about third-party mediation, the ceasefire and the US’s willingness to help broker peace has calmed investor nerves, leading to renewed interest in Indian equities.
Pharma Stocks Fall as Trump Targets Drug Prices
Despite broader market gains, Asian pharmaceutical stocks declined after President Trump announced plans to sign an executive order to slash US drug prices by up to 80%.
Japanese pharma giants Takeda Pharmaceutical, Daiichi Sankyo, and Chugai Pharmaceutical dropped between 4% and 7%. South Korea’s Samsung Biologics and SK Biopharmaceuticals also fell sharply. Meanwhile, India’s Nifty Pharma Index dipped 0.4%, underperforming the broader market.
Regional Market Summary
| Index | Change |
|---|---|
| Shanghai Composite | +0.9% |
| CSI 300 | +1.1% |
| Hang Seng Index | +1.5% |
| Nikkei 225 (Japan) | +0.1% |
| TOPIX (Japan) | Flat |
| ASX 200 (Australia) | +0.3% |
| Nifty 50 (India) | +3.0% |
| Nifty Pharma (India) | -0.4% |
📊 Key Takeaways for Investors
- US-China trade agreement boosts global equities, especially in China and Hong Kong.
- India-Pakistan ceasefire provides relief to Indian markets and strengthens investor confidence.
- Trump’s drug price crackdown pressures pharmaceutical stocks across Asia.
- Market focus shifts to the official trade deal announcement expected later today.
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