Asian stocks experienced a mixed performance on Monday following President Joe Biden's decision to exit the 2024 presidential race. The week began on a downbeat note after Wall Street recorded losses on Friday due to disruptions caused by a massive technology outage affecting businesses worldwide.
U.S. futures remained relatively stable, while oil prices saw a slight increase. Biden's announcement of his withdrawal from the race and endorsement of Vice President Kamala Harris added to uncertainties surrounding the world's largest economy.
Japan's Nikkei 225 index dropped by 1.3% to 39,556.85 in morning trading. Meanwhile, the Hang Seng in Hong Kong rose by 0.8% to 17,548.33, and the Shanghai Composite index fell by 0.7% to 2,961.41 after China's central bank unexpectedly reduced its one-year benchmark loan prime rate.
China's move to lower interest rates was aimed at stimulating growth and addressing a prolonged property market downturn following a slower-than-expected 4.7% expansion of the economy in the second quarter.
Elsewhere in Asia, Australia's S&P/ASX 200 declined by 0.6% to 7,924.40, and South Korea's Kospi lost 1.4% to 2,756.62.
On Friday, the S&P 500, Dow Jones Industrial Average, and Nasdaq composite all closed lower, marking the S&P 500's first losing week in three and its worst performance since April. The market downturn was exacerbated by a major technology outage that disrupted various sectors globally.
Cybersecurity firm CrowdStrike attributed the outage to a faulty update affecting computers running Microsoft Windows, leading to a decline in its stock price. However, industry analysts believe that this incident is unlikely to have long-term implications for the cybersecurity sector.
The outage impacted air travel, banking services, and healthcare appointments worldwide, causing disruptions that were eventually resolved. U.S. airline stocks initially dipped but recovered, with United Airlines even turning a gain of 3.3%.
In the bond market, yields rose slightly, with the 10-year Treasury yield increasing to 4.23%. U.S. benchmark crude oil prices rose to $78.98 per barrel, while Brent crude reached $83.04 per barrel.
The U.S. dollar strengthened against the Japanese yen and the euro, reflecting ongoing market fluctuations amid global economic uncertainties.
