Australia

Australian shares are set to rise at the open, following solid gains on Wall St ahead of this week's central-bank meetings, jobs data and a highly anticipated borrowing announcement from the Treasury Department.

ASX futures were up 0.4% or 29 points as of 8:00am on Tuesday, suggesting a higher open.

US stocks posted solid gains Monday ahead of this week's central-bank meetings, jobs data and a highly anticipated borrowing announcement from the Treasury Department.

Bouncing back from a difficult week when the S&P 500 and Nasdaq Composite entered into corrections—or declines of 10% from their recent peaks—all three major indexes gained more than 1%, powered in large part by a rebound in shares of large technology companies.

The Dow Jones Industrial Average led the way, rising 1.6%, or 511 points. The S&P 500 and Nasdaq Composite both advanced 1.2%.

Despite the gains, investors remained focused on the U.S. bond market, worried that surging Treasury yields could slow the economy and damp the appeal of riskier assets. Some investors and analysts believe this week could prove pivotal for bonds.

In commodity markets, Brent crude oil fell 2.9% to US$87.86 a barrel while gold was flat at US$1,996.30.

In local bond markets, the yield on Australian 2 Year government bonds was higher at 4.42% while the 10 Year yield was also up at 4.87%. US Treasury notes were up, with the 2 Year yield at 5.05% and the 10 Year yield at 4.89%.

The Australian dollar hit 63.76 US cents up from the previous close of 63.31. The Wall Street Journal Dollar Index, which tracks the US dollar against 16 other currencies, was flat at 100.34.

Asia

Chinese shares ended higher, led by semiconductor and medical stocks. As China's recovery continues to chug along, analysts are expecting that upcoming policy meetings will focus more on structural growth in the medium and longer term, HSBC Global Research analysts write in a research note. Semiconductor and medical stocks led the gains. Shenzhen China Micro Semicon rose 3.7% and Maxscend Microelectronics, the leading Chinese chipmaker, gained 20%. Pharmaron Beijing rose 13% after the medical company reported 3Q revenue of CNY2.92 billion, up 5.5% on year. Hangzhou Tigermed Consulting advanced 9.2% after it reported 3Q profit rose 19%. Banks led the losers with China CITIC Bank down 4.5% and Postal Savings Bank of China down 4.8%. The benchmark Shanghai Composite closed 0.1% higher at 3021.55, Shenzhen Composite Index advanced 1.4%, and ChiNext Price Index rose 2.5%.

Hong Kong shares ended flat, as tech and pharma stocks' gains offset losses among banks. Banking shares weighed after a slew of Chinese state-owned lenders reported weaker-than-expected 3Q earnings, raising concerns about their exposure to China's property sector. Industrial & Commercial Bank of China dropped 2.9% and China Construction Bank lost 1.75%. HSBC Holdings shed 1.5%, as its 3Q results also missed market expectations, although net profit more than doubled. Pharma stocks were broadly higher, with Hansoh up 6.4% and Sino Biopharmaceutical rising 5.8%. Tech stocks rallied, with Xiaomi rising 6.1% and Lenovo gaining 5.0%. The benchmark Hang Seng Index ended flat at 17406.36 while the Hang Seng Tech Index climbed 1.3%.

Japanese stocks ended lower, dragged by weakness in auto and pharmaceutical stocks, amid growing concerns about the Middle East conflict and its impact on the global economy. Nissan Motor dropped 4.5% and Kyowa Kirin shed 4.2%. The Nikkei Stock Average fell 1.0% to 30696.96. The 10-year Japanese government bond yield rises 2 bps to 0.890%. Investors are focusing on crude-oil prices and bond yields, as well as corporate earnings results.

Indian shares ended higher, lifted by bank stocks. ICICI Bank gained 1.3% and HDFC Bank rose 1.0%. Reliance Industries added 2% after it posted a 2Q net profit gain on Friday. Adani Green Energy jumped 5% after strong 2Q results. Auto stocks weighed on the market, with Tata Motors losing 1.9% and Maruti Suzuki India down 1.5%. Caution over the Israel-Hamas conflict persists after the Israeli prime minister announced a second phase of Gaza operations over the weekend. Investors are looking ahead to the U.S. Fed's interest-rate meeting this week. The benchmark Sensex index closed 0.5% higher at 64112.65.

Europe

European stocks rose as investors shrug off concerns about a possible escalation of Middle East unrest. The Stoxx Europe 600 and CAC 40 advanced 0.4%, and the DAX climbed 0.2%, with most banks rising despite JPMorgan advising investors to "open a short" on the sector, saying it might struggle if bond yields fall. Brent crude fell 2.9% to $87.86 a barrel, hitting oil shares. European markets have started the week positively despite Israel taking early steps to push into Gaza, CMC Markets says. "The limited and incremental nature of the incursions thus far appears to be helping assuage concerns that the escalations might prompt another front opening on Israel's northern border," CMC analyst Michael Hewson writes.

The FTSE 100 closed Monday up 0.495% together with other European markets, ending two straight weeks of declines. The positive start to the week for European markets comes despite Israel taking early steps to push into Gaza—the limited and incremental incursions so far seem to be helping assuage concerns that escalations might prompt another front opening on Israel's northern border, with gold and crude-oil prices sliding as a result, CMC Markets UK's chief market analyst Michael Hewson says in a research note. "The main drags on the FTSE 100 have been energy due to the slide in oil prices, although we could be seeing some profit taking on BP and Shell ahead of their third-quarter numbers later this week," Hewson adds.

North America

Stocks posted solid gains Monday ahead of this week's central-bank meetings, jobs data and a highly anticipated borrowing announcement from the Treasury Department.

Bouncing back from a difficult week when the S&P 500 and Nasdaq Composite entered into corrections—or declines of 10% from their recent peaks—all three major indexes gained more than 1%, powered in large part by a rebound in shares of large technology companies.

The Dow Jones Industrial Average led the way, rising 1.6%, or 511 points. The S&P 500 and Nasdaq Composite both advanced 1.2%.

Despite the gains, investors remained focused on the U.S. bond market, worried that surging Treasury yields could slow the economy and damp the appeal of riskier assets. Some investors and analysts believe this week could prove pivotal for bonds.

Before the U.S. market opens on Tuesday, many anticipate that the Bank of Japan will announce a further loosening in its policy to cap longer-term bond yields, a move that could further drive up U.S. bond yields. On Wednesday, the Federal Reserve will issue its own policy statement, and the Treasury Department will outline the size of coming bond auctions in its quarterly refunding announcement.

Meanwhile, investors will get reports on the state of the labor market, capped off by the monthly jobs report on Friday.

Ahead of those events, the yield on the benchmark 10-year U.S. Treasury note edged up to 4.875% Monday, from 4.846% Friday. The yield had briefly topped 5% early last week.

While investors have paid a fair amount of attention recently to the conflict between Israel and Hamas, for stocks, "the bigger issue is the surge in interest rates," said George Mateyo, chief investment officer at Key Private Bank.

Mateyo said he was particularly interested in the refunding announcement, given the possible role that the growing supply of Treasurys has played in driving up yields recently.

Many analysts have expected the Treasury to increase auctions of notes and bonds by a similar amount as it did a few months ago, when auctions of 10-year notes were boosted by $3 billion. On Monday, the agency said it anticipates borrowing $776 billion in privately held marketable debt over the final three months of the year. That is less than it expected in late July, though it would still be a record for the quarter.

After rallying earlier this year, the S&P 500's year-to-date gains have been cut to 8.5%.

Among individual stocks on Monday, McDonald's rose 1.7% after it reported a larger-than-expected increase in sales in the third quarter, boosted by bigger orders and higher prices. Shares of ON Semiconductor plunged 22% after the maker of intelligent sensing and power services issued a bleak fourth-quarter outlook.

Technology stocks had a good day. Alphabet rose 1.9% after disappointing earnings sent it down almost 10% last week. Apple, which was scheduled to release earnings after the market closes on Thursday, gained 1.2%.

One tailwind for the market was a decline in oil prices, as investors expressed cautious relief that Israel's ground invasion into Gaza Strip hasn't spilled over into a broader regional conflict.

U.S. crude futures fell 3.8% Monday to $82.31 a barrel, leaving them roughly level with where they were before Hamas's Oct. 7 attack on Israel.