Asian Stocks Rally in June as Trade Optimism and Geopolitical Easing Drive Sentiment

Most Asian stock markets climbed on Monday, capping a strong June performance as investors cheered progress on U.S. trade agreements and a reduction in geopolitical risks. The rally mirrored Friday's record-setting Wall Street session and pointed to growing investor confidence in Asia-Pacific markets.

Japan Leads Regional Surge as Nikkei Hits One-Year High

Japan's Nikkei 225 jumped 1.6%, hitting its highest level since July last year, led by strong tech sector gains and a tailwind from the weakening yen. The broader TOPIX index also rose 1%.

• The Nikkei is up 8% in June, logging its third consecutive monthly gain.

• A softer yen has improved earnings prospects for Japanese exporters.

Regional Snapshot: Asia Tracks Toward Strong Monthly Gains

Across Asia, equity markets remained mostly green:

• South Korea's KOSPI: +0.8% Monday, +14% in June - one of the best monthly performances globally.

• China's Shanghai Composite: +0.3% Monday, +2.2% in June.

• Shanghai Shenzhen CSI 300: +0.1% Monday, also up over 2% in June.

• Hong Kong's Hang Seng: -0.6% Monday, but +3.5% month-to-date.

These gains come as Asian economies accelerate trade negotiations with U.S. President Donald Trump ahead of the July 9 tariff deadline. Markets were further supported by the announcement last week of a finalized U.S.-China trade agreement, wrapping up talks from the Geneva summit.

Geopolitical Relief: Trump-Brokered Ceasefire Supports Risk-On Rally

Markets were further lifted by a ceasefire between Israel and Iran, brokered by Trump, that helped ease global supply chain concerns and reduced volatility across risk assets. Traders are cautiously optimistic that Middle East tensions will remain subdued in the near term.

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Final Take

As June wraps up, Asian equity markets are poised to deliver some of their strongest monthly returns in over a year, driven by trade optimism, easing geopolitical risk, and positive spillovers from Wall Street. Whether the momentum will hold through July will largely depend on the finalization of trade agreements and the trajectory of U.S. interest rate policy.