US stocks were higher on Wednesday, with the S&P 500 rising 1.2% and the Nasdaq gaining 1.9% while the Dow Jones booked more modest gains of 60 points. Traders continue to digest fresh corporate results and await the FOMC monetary policy decision in which the Fed is expected to signal a rate cut in September. The tech sector was the top performer, as Nvidia soared almost 8% after Morgan Stanley renamed it a top pick. Shares of AMD also jumped 7.5% after the company's results topped estimates. Broadcom (6%) and Qualcomm (4.2%) were also higher after Reuters reported some foreign companies will not be affected by US export restrictions on chipmaking to China. Microsoft on the other hand, lost about 1.6% amid disappointing cloud results. Meta is also due to report quarterly results today after the closing bell. Meanwhile, fresh labour market data including the ADP report and employment costs for Q2 reinforced bets the Fed will cut interest rates soon.
The Nikkei 225 Index jumped 1.49% to close at 39,102 while the broader Topix Index gained 1.45% to 2,794 on Wednesday, reversing losses from earlier in the session as the market rallied in relief after the Bank of Japan raised its policy rate to around 0.25%, confirming market rumours. The central bank also said it will reduce its monthly bond purchases to about 3 trillion yen per month in the first quarter of 2026. Moreover, the BOJ added that if the outlook for economic activity and prices are realized, it will continue to raise the policy rate and adjust the degree of monetary accommodation. Financial stocks led the charge amid expectations that higher rates would improve lending margins and potentially increase investment income. Strong gains were seen from Mitsubishi UFJ (4.1%), Sumitomo Mitsui (4.5%) and Mizuho Financial (5.1%). Technology, consumer and shipping stocks also advanced, while exporters such as automakers weakened as the yen rallied.
The Shanghai Composite jumped 2.06% to close at 2,939 while the Shenzhen Component rallied 3.37% to 8,754 on Wednesday, with mainland stocks rebounding sharply from near six-month lows as China’s leaders pledged to step up support measures and stabilize market confidence at a Politburo meeting this week. The meeting stressed the need to boost consumption to realize growth targets, a shift from previous focus on infrastructure projects. Sentiment was also lifted after a new vice chairman with a background in law enforcement was appointed at the China Securities Regulatory Commission. Meanwhile, data showed that manufacturing activity in China contracted at a slightly faster pace in July, while services sector growth slowed to an eight-month low. High-growth auto and consumer stocks led the advance, with strong gains from Bluepark New Energy (10%), Seres Group (5.3%) and Kweichow Moutai (2.3%).
The BSE Sensex added 286 points, or 0.4%, to close at 81,741.3 on Wednesday, a fresh record level, marking the fourth consecutive session of advances. Most sectors ended in the green, led by metal stocks. Also, Maruti was among the top performers, rising 2.3%, after reporting a better-than-expected quarterly profit. Globally, investors anticipated the Fed's monetary policy decision later today and hinted about rate cuts in September. The main index advanced over 3% for the month, notching the 2nd straight monthly gain, boosted by some bargain hunting and optimism that both the Fed and RBI may cut rates in the medium term due to favourable inflation trends.
