Investing.com — Most Asian stocks rose on Monday, bouncing back from last week's sharp declines, although market sentiment remained tense amid growing expectations that the conflict between Iran and Israel will not worsen.
The decline in technology stocks also appears to have ended after the sector, particularly chip makers, posted heavy losses last week.
U.S. stock index futures also rose in Asian trading, with Wall Street looking to recover from steep losses over the past week.
Chinese stocks rise slightly as loan prime rate remains stable
China's index and index rose 0.4% and 0.3%, respectively. Both indexes were among the few Asian stock exchanges to end in positive territory last week, as the prospect of further support measures from the Chinese government boosted local market sentiment.
The People's Bank of China on Monday kept the benchmark at its lowest level on record, aiming to keep monetary accommodation as easy as possible to support economic recovery.
Further cuts to the loan prime rate may be scheduled for later this year, given that the Chinese government needs to increase the pace of stimulus to support the economy.
Hong Kong's index rose 2.3% on Monday, rebounding from the previous day.
Asian markets are booming as concerns about Iran and Israel ease
The lack of immediate tensions between Iran and Israel also contributed to improving sentiment, with broader Asian markets rebounding from last week's decline.
Japan's index and index rose 0.8% and 1.2%, respectively, after falling between 4% and 6.5% over the past week.
This week's focus is really on what's to come later this week. The Bank of Japan will hold its first meeting since its historic rate hike in March.
Australia rose 1% after falling 2.8% last week, and South Korea rose 0.9% after falling 3.4% last week.
Indian index futures also indicated a positive opening.
Regional markets fell on Friday after reports that Israel carried out attacks in and around Iran.
But Iran downplayed the impact of the attack and said it had no immediate plans for retaliation. This raised hopes that the conflict between Iran and Israel would not spill over into a broader war in the Middle East.
Still, sentiment towards risky markets, particularly equities, remained fragile, especially given the prolonged high level of US interest rates.
Asian markets continue to have a weak start to the second quarter and were awaiting a number of important signals from the US this week.
Several major U.S. technology companies are scheduled to report quarterly results this week, as well as data on the Federal Reserve's preferred measure of inflation.