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The Bank of Japan headquarters in Tokyo.
Bloomberg | Getty Images
Asia-Pacific markets were set for a mixed session ahead of a key monetary policy decision by the Bank of Japan, and fresh economic data points throughout the region.
The Bank of Japan will conclude its two-day policy meeting later in the day, with investors watching for any signs of the central bank raising its inflation forecasts.
It is also expected to discuss further adjustments to its bond yield control.
Japan's Nikkei 225 is also set to fall ahead of the July inflation reading, with the futures contract in Chicago at 30,600 and its counterpart in Osaka at 30,570 against the index's last close of 30,696.96.
Futures for Hong Kong's Hang Seng index stood at 17,393, pointing to a weaker open compared to the HSI's close of 17,406.36.
In Australia, the S&P/ASX 200 opened 0.54% higher.
Oil prices slide as investors eye war, Fed
Oil prices fell on Monday as investors closely followed the Israel-Hamas war while readying for the Federal Reserve policy meeting later this week.
Brent fell 2.9% at $87.88 per barrel. The U.S. West Texas Intermediate futures declined 3.5% to $82.59 per barrel.
— Alex Harring, Lee Ying Shan
Morgan Stanley's top strategist says fourth-quarterly rally unlikely
The likelihood of a fourth-quarter rally has "fallen considerably" over the past month, according to Morgan Stanley chief U.S. equity strategist Mike Wilson.
Wilson has been forecasting the S&P 500 ending the year at 3900, making him among the most bearish strategists on Wall Street according to CNBC's Market Strategist Survey. While he noted in a Sunday note to clients that initial bullish sentiments waned in September — before picking up again this month on expectations of better third-quarter earnings and seasonal strength into the year-end — his lower estimate for the broad market index remains.
To read more about his call, click here.
— Hakyung Kim
Bank of Japan to consider allowing yields to rise above 1%, report says
Bank of Japan officials on Tuesday are expected to consider allowing longer-term bond yields to rise above a 1% cap amid a run-up in rates the central bank is trying to stave off, according to a report Monday.
Rising U.S. bond yields have spread globally and are pressuring their global counterparts, particularly since Federal Reserve Chairman Jerome Powell recently emphasized his commitment to fighting inflation. Allowing flexibility on previous yield curve caps could provide BoJ officials some breathing room, NikkeiAsia reported, citing sources familiar with the talks.
Rising U.S. bond rates have resulted in money flowing to the dollar, putting downward pressure on the yen and exacerbating inflation. Allowing some flexibility on the caps chases away speculators while helping Japan manage its own inflation issue.
The yen rose against the U.S. dollar following the Nikkei report, most recently trading at 149.21.
—Jeff Cox
English (US)