Asian Shares Mostly Higher Before Trump Inauguration

(RTTNews) - Most Asian stocks rose on Monday after major U.S. stock indexes rallied to close out their best week in two months Friday on interest-rate cut optimism.

Regional gains, however, remained capped due to a holiday in the U.S. and amid caution ahead of U.S. President-elect Donald Trump's inauguration later in the day.

Markets are bracing for major policy announcements and sweeping changes in U.S. trade policies that could thrust businesses into considerable uncertainty.

The dollar index retreated in Asian trade while the Japanese yen held near a one-month high amid expectations that the Bank of Japan (BOJ) might raise interest rates at its upcoming policy meeting.

Gold edged up slightly while oil prices dipped after rising more than 1 percent last week, marking their fourth consecutive weekly rise.

China's Shanghai Composite index finished marginally higher at 3,244.38, giving up early gains after an amicable call between Trump and Xi on trade, TikTok and fentanyl.

Earlier in the day, the People's Bank of China maintained its interest rates for the third straight month, keeping the one-year LPR at 3.1 percent and the five-year LPR at 3.6 percent, amid much uncertainty over the stance of new U.S. administration.

Hong Kong's Hang Seng index jumped 1.75 percent to 19,925.81, led by tech stocks fueled by China's subsidy programs. JD.com soared 7.2 percent and Alibaba surged 4.5 percent.

Real estate stocks also rose as a court extended a deadline for troubled property developer Country Garden to reach an agreement with its creditors until next month.

Japanese markets rallied as investors prepared for a possible BoJ rate hike at the end of a two-day policy meeting on Friday. The Nikkei average climbed 1.17 percent to 38,902.50 after three straight weeks of declines.

The broader Topix index settled 1.19 percent higher at 2,711.27. Automakers led the surge, with Honda Motor rising 1.4 percent while Toyota Motor and Subaru both gained around 3 percent.

Daiichi Sankyo jumped 8.2 percent after the company received FDA approval for a breast cancer treatment it is developing with AstraZeneca.

In economic news, government data showed that Japan's core machinery orders rose 3.4 percent in November from the previous month to beat analysts' forecast.

Seoul stocks ended lower for a second day running, with the Kospi average closing down 0.14 percent at 2,520.05, dragged down by chip and auto stocks.

Australian markets ended higher, led by financials, tech and real estate stocks. The benchmark S&P/ASX 200 rose 0.45 percent to 8,347.40 while the broader All Ordinaries index closed up 0.43 percent at 8,594.40.

Across the Tasman, New Zealand's benchmark S&P/NZX-50 index dipped 0.32 percent to 13,088.31.

U.S. stocks rose sharply on Friday and posted weekly gains for the first time in three weeks amid optimism over the health of the economy and path of interest rates.

In economic news, industrial production increased by much more than expected in December while U.S. single-family homebuilding rose to a 10-month high, separate reports showed.

The tech-heavy Nasdaq Composite surged 1.5 percent, while the S&P 500 rallied 1 percent and the Dow added 0.8 percent to notch their biggest weekly gains since the week of the November presidential election.