Asia Opens Higher as US Fiscal Deal Progress Fuels Risk-On Mood

GLOBAL MOOD: Risk-on
Drivers: US Shutdown Deal Progress, UK Retail Slowdown

Asian markets traded risk-on, lifted by Wall Street gains and optimism over a possible end to the prolonged US government shutdown. Fiscal deal progress buoyed sentiment, though uncertainty over final approval and mixed US data kept upside capped

TODAY’S WATCHLIST
 - India AMFI Monthly Data
 - Earnings: Bosch, Tata Power
 - ECB President Lagarde
 

THE BIG STORY
The longest US government shutdown in history may finally end this week after a compromise funding deal cleared an initial Senate hurdle late Sunday. The proposal, which would restore funding for agencies whose budgets lapsed on 1 October, brings potential relief to millions affected by the closure including low-income families hit by food subsidy disruptions, federal workers who have gone unpaid for over a month, and travellers enduring thousands of flight cancellations. The agreement extends funding through 30 January, temporarily putting the government back on a fiscal track that continues to add roughly $1.8 trillion annually to its $38 trillion debt burden.

In a procedural vote, the Senate secured the minimum 60 votes needed to advance the measure, with eight Democratic senators breaking from party leadership to support the bill. They agreed to drop a key demand for extending Affordable Care Act tax credits, a central Democratic priority excluded from the final draft. The package would fund the Departments of Agriculture, Veterans Affairs, and Congress, among other agencies, but still faces a full Senate debate and uncertain House approval before becoming law.

Data Spotlight
UK retail sales growth slowed in October, rising 1.5% year-on-year on a like-for-like basis it is the weakest pace in five months and down from 2% in September. Consumers largely delayed purchases ahead of Black Friday and possible budget-related tax hikes, softening momentum across categories. Food sales eased to 3.5% from 4.3%, as households conserved cash for the holidays, while non-food sales edged up just 0.1%, constrained by mild weather and discount anticipation. Notably, furniture and homeware sales outperformed, buoyed by early festive spending preparations.

Takeaway: Weaker October sales highlight cautious consumer behaviour and heighten pressure on Black Friday to deliver a vital lift for UK retailers.

WHAT HAPPENED OVERNIGHT

• US Stocks surge on AI rally, shutdown deal optimism
  
  • Wall Street rallied sharply as a bipartisan funding deal cleared an initial Senate hurdle.
  • NVIDIA jumped 5.8%, PALANTIR surged 8.8%, and TESLA rose 3.7%, leading tech gains.
  • Airline stocks lagged amid ongoing flight cuts. 

• US Treasury yields climb as fiscal optimism grows
  • 10-year US treasury yield hit 4.15% before easing to 4.12%, up 2.7 bps from Friday.
  • 2-year yield advanced 3.8 bps to 3.60%, reflecting stronger risk appetite. 

• US Dollar steadies after early shutdown progress
  • Dollar index held near 99.6, pausing a three-day slide.
  • Traders await full Congressional approval of the funding deal before reassessing rate bets. 

• Crude oil gains on renewed supply risks
  • Brent crude oil rose 0.7% to $64.06/barrel; WTI up 0.6% to $60.13/barrel.
    
  • Gains driven by US sanctions and Ukrainian drone strikes targeting Russian refineries. 

Day’s Ledger

Economic Data

• Japan Sep Current Account
• India States Loan Auction 
• India AMFI Monthly Data 

Corporate Actions

• Jul-Sep Earnings: BSE, Bajaj Finserv, Bajaj Holding, Bharat Forge, Biocon, Bosch, Concor, Max Financial, PI Industries, RVNL, Tata Power, Torrent Power
• Adani Enterprises to consider rights issue 

Policy Events

• ECB President Lagarde Speech             
  

Tickers to Watch

• JK TYRE aiming for 20% export share in 5 years: CMD Raghupati Singhania
• Varun Berry resigns as BRITANNIA MD and CEO after 13 years at the helm
• CANARA BANK expects strong credit growth in H2 led by GST cuts, rural push
• GLENMARK gets China approval for Ryaltris nasal spray for allergies
• GHCL partners with AuthBridge to strengthen supplier ESG compliance
• BAJAJ FINANCE Q2 profit drops 24% on higher provisions, base effect
• KPIT Q2 profit falls 17% to ₹169 crore on JV losses, revenue up 8%
• IRB INFRA reports 9% rise in toll revenue to ₹6.82 billion in October 

Must Read

• Govt proposes mandatory 'country of origin' filters for ecom platforms
• India tracks Trump tariff case for impact on trade deal with the US
• Pharma units likely to be under fire for violating Schedule M: Experts
• India's jobless rate falls to 5.2% in Q2, youth unemployment rises
• Tractor sales touch all-time high in October driven by GST cut and favourable monsoon
• Fed’s Daly Says Need to Avoid Mistake of Holding Rates Too Long
• Fed’s Musalem Sees US Economic Rebound in First Quarter
• Trump's $2,000 'tariff dividend' for Americans may end up costing them more
• Democrats Fume Over Deal to End Government Shutdown

See you tomorrow with another edition of The Morning Edge.

Have a great trading day

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