Asian Markets Rally as Nikkei and KOSPI Surge on Weak US Jobs Data

Key Facts

In a move reflecting shifting global monetary policy expectations, Asian equity markets staged a notable recovery during Monday's trading session. Japan's Nikkei 225 surged by 2%, while South Korea's KOSPI added 1.1%. According to reports, this momentum was primarily driven by surprisingly weak US jobs data, which significantly cooled expectations for further Federal Reserve rate hikes.

The rally comes as investor sentiment shifts back toward riskier assets, despite ongoing geopolitical uncertainties in the Strait of Hormuz. Per market data, the easing of interest rate fears outweighed regional tensions, allowing major indices in Japan and South Korea to lead the regional upturn following previous sell-offs.

Looking ahead, investors are closely monitoring the impact of macro data on central bank decisions, noting that South Korea's annual inflation rate slowed to 2.8% as of August 2026. Markets are also awaiting the Bank of Japan's monetary policy meeting minutes scheduled for later this week to gauge further interest rate directions in the region.