Asian Stocks Edge Higher as China Cuts Loan Prime Rate and RBA Eases

Most Asian markets ticked up on Tuesday, led by mainland and Hong Kong equities after Beijing trimmed its benchmark loan prime rate. Australia's ASX 200 also rose following the Reserve Bank's 25 bp rate cut, while Wall Street futures softened on Moody's U.S. credit downgrade.

China's CSI 300 and Shanghai Composite gained about 0.3% and 0.2%, respectively, and the Hang Seng jumped 1% after the People's Bank of China signaled readiness for further monetary support. However, a Commerce Ministry warning that U.S. chip export curbs—targeting Huawei's Ascend processors—could derail recent trade de-escalation capped upside.

Australia's ASX 200 rallied 0.5%, flirting with three-month highs, as the RBA cut rates but kept a cautious, data-driven outlook, flagging slower 2025 GDP growth of 2.1% and softer inflation ahead. Broader gains included Japan's Nikkei 225 (+0.5%) and TOPIX (+0.3%) after confirmation of fresh U.S.-Japan trade talks, and South Korea's KOSPI (+0.2%). India's Nifty 50 Futures dipped 0.1% amid profit-taking and hopes for an interim U.S. trade deal before July's tariff deadline.

Market breadth data from FMP's Market - Biggest Gainers API highlights technology and financials leading the advance across Asia's major bourses (Market - Biggest Gainers API). Traders can also monitor key events—like the U.S. House vote on a Trump-backed tax bill and upcoming U.S.-Japan negotiations—via the Economics Calendar API to anticipate volatility spikes (Economics Calendar API).

Actionable Takeaways

• Position for Divergence: Tilt toward Chinese and Australian equities on stimulus cues, while hedging dollar exposure via regional FX pairs.

• Event-Driven Alertness: Link real-time macro calendars with equity feeds to navigate headline-driven moves around U.S. policy votes and trade talks.

• Selective Rotation: Rotate into sectors benefiting from rate cuts—banking in China and housing-sensitive names in Australia—while watching for renewed trade-related sell-offs.