European stocks opened mixed, Japanese stocks closed lower, gold fluctuated at high levels, and the US dollar weakened

Market optimism regarding the Federal Reserve's impending interest rate cuts, combined with the ongoing growth potential in the technology sector, has ignited investors' risk appetite.

On Tuesday, European stocks opened mixed, with the Euro Stoxx 50 index up 0.18% and the French CAC 40 index up 0.18%. Japanese stocks generally closed lower. U.S. stock index futures rose, continuing the record highs set by the S&P 500 index and the Nasdaq Composite index in the previous trading session.

In other markets, oil prices rose for the second consecutive day due to weak demand prospects following Saudi Arabia's reduction of its official selling prices for most grades of crude oil. Iron ore prices climbed for the sixth consecutive day, driven by market expectations of increased global demand, and are expected to reach the highest closing price in over six months. Gold prices surged to new historical highs as the dollar weakened.

• European stocks opened mixed, with the Euro Stoxx 50 index up 0.18%, the UK FTSE 100 index up 0.15%, the French CAC 40 index up 0.18%, and the German DAX 30 index down 0.01%.

• S&P 500 index futures were little changed. Nasdaq 100 index futures rose 0.1%.

• The Nikkei 225 index closed down 0.4% at 43,459.29 points. The Tokyo Stock Exchange index closed down 0.5% at 3,122.12 points. The Seoul Composite Index closed up 1.3% at 3,260.05 points.

• The Taiwan Stock Exchange Weighted Index closed up 1.3% at 24,855.18 points.

• The U.S. dollar index fell 0.13% to 97.32.

• The euro rose 0.1% to 1.1777 U.S. dollars.

• The New Taiwan dollar rose 0.5% against the U.S. dollar to 30.368, reaching a nearly three-week high.

• The yield on 10-year U.S. Treasury bonds rose 1 basis point to 4.05%.

• The yield on 10-year German government bonds fell 2 basis points to 2.64%.

• Spot gold rose 0.1% to 3,639.16 U.S. dollars per ounce.

• West Texas Intermediate crude oil rose 0.6% to 62.64 U.S. dollars per barrel.

Tech Stock Boom Continues, Interest Rate Cut Path in Focus

S&P 500 index futures were little changed. Nasdaq 100 index futures rose 0.1%. Spot gold rose 0.1% to 3,639.16 U.S. dollars per ounce.

For investors, the biggest question has shifted from "whether there will be rate cuts" to "how many times will rates be cut." Megan Horneman of Verdence Capital Advisors believes that the upcoming inflation data may not be sufficient to alter the likelihood of a rate cut by the Federal Reserve in September. She also cautioned that if inflation data continues to deviate from targets, the Federal Reserve may issue "hawkish" statements alongside rate cuts to emphasize its dual mandate The market is closely watching the core Consumer Price Index (CPI) to be released this Thursday, with expectations that the data will show a month-on-month increase of 0.3% for the second consecutive month. Frederic Neumann, Chief Asian Economist at HSBC, stated that Asian markets may continue to follow the guidance of the U.S. market in the coming days, as U.S. inflation data will provide clues not only for the Federal Reserve but also for the interest rate paths of central banks in various Asian countries.

Technology stocks remain the "fashion barometer" of this market rally. The Nasdaq Composite Index has reached a new all-time high, highlighting investors' continued confidence in the growth prospects of the sector. Tim Waterer, Chief Market Analyst at KCM Trade, stated:

"Investors still see growth potential in the tech sector, which is why funds continue to flow into this area."

The U.S. Dollar Spot Index fell 0.13% to 97.32.

Political Risks Disturb Asian and European Markets

Despite the overall optimistic market sentiment, political dynamics in several major Asian economies have created uncertainty for investors. In Indonesia, President Prabowo Subianto suddenly replaced Finance Minister Sri Mulyani Indrawati, raising concerns about the country's fiscal discipline and potentially leading to new financial turmoil for the largest economy in Southeast Asia. Following the announcement, the Indonesian rupiah depreciated against the U.S. dollar, and the Indonesian central bank indicated it would intervene to maintain exchange rate stability. The local stock market fell by as much as 1.8% on Tuesday, with the yield premium on Indonesian dollar bonds and the cost of credit default swaps both widening.

According to strategist Mary Nicola, "After the sudden dismissal of Finance Minister Sri Mulyani Indrawati, Indonesian assets face new pressures, and this move may reignite concerns about the country's fiscal discipline. The Indonesian market will struggle to shake off pressure until the outlook becomes clearer."

In Japan, the impact of Prime Minister Shigeru Ishiba's resignation has also spread to the market. The Nikkei 225 index turned lower after reaching a historic high during Tuesday's trading session.

European stocks opened mixed, with the Euro Stoxx 50 index up 0.18%, the UK FTSE 100 index up 0.15%, the French CAC 40 index up 0.18%, and the German DAX 30 index down 0.01%