Investing.com – Most Asian stocks fell slightly on Monday, mainly due to caution ahead of China’s national congress in 2024, although robust gains in technology stocks sent Japanese markets to new highs.
Regional markets largely ignored the positive signal from Wall Street, which hit record highs on Friday. US stock futures were also muted in Asian trading on Monday as readings and key data encouraged caution this week.
Chinese stocks fall ahead of 2024 national congress
But the biggest focus for Asian markets is the annual National People’s Congress in Beijing, which opens on Tuesday and is set to chart the path of Asia’s largest economy in the coming year.
While optimism over greater policy support helped Chinese stocks rebound from five-year lows before February, their rally now appears to have fizzled out.
China’s blue-chip index fell 0.2% on Monday, while the index lost 0.3%.
Losses in mainland Chinese stocks sent Hong Kong shares down 0.5%.
Recent official data continues to paint a gloomy picture of the Chinese economy, even as calls for the liquidation of the country’s largest property developer Country garden Holdings Company Ltd (HK:) pointed to new problems in the property market.
Japanese stocks are an exception, with the Nikkei breaking above 40,000.
Japanese shares continued to outperform their regional peers significantly, rising 0.7% to a new record high of 40,356.0.
The broader index rose 0.2% and also hit a record high.
The Nikkei’s crossing of 40,000 has seen the index clear a major psychological hurdle – a trend that could lead to even greater gains in the short term.
Technology stocks were the biggest boost for the Nikkei, as continued hype around artificial intelligence led to stellar gains for shares of their U.S. peers.
Signs of strength in the Japanese economy and falling inflation also helped extend the Nikkei’s rally. This week the focus will be on the key index, which usually acts as a leader for the Japanese economy as a whole.
Most other Asian markets showed declines on Monday. The exception was South Korea, which rose 1% in catch-up trading as technology stocks rose.
Australian indices remained flat after hitting record highs last week. Key data will also be available this week.
India index futures are pointing to a muted open after the index hit record highs last week amid persistent optimism about India’s fast-growing economy.