Asian Stock Market: Hang Seng surges 2% while Nikkei 225 slumps over 2%

Asian markets opened the week on a mixed note, with Chinese equities rallying while Japanese and South Korean benchmarks fell sharply.

Japan’s Nikkei 225 led regional losses, dropping 2.03% to 41,849.82, pressured by continued contraction in factory activity.
Hong Kong’s Hang Seng Index (HSI) jumped 2.17% to 25,621.73, fueled by optimism from better-than-expected Chinese manufacturing data.
On the mainland, the Shanghai Composite rose 0.43% to 3,874.34, while the Shenzhen Composite added 0.34% to 12,739.87.
South Korea’s Kospi Composite slipped 0.74% to 3,162.33, extending its weak trend.
Australia’s S&P/ASX 200 also fell 0.60% to 8,919.4, despite the country reporting its eighth consecutive month of factory activity expansion.

The contrasting performance came as investors weighed multiple global and regional developments:

Chinese boost: Fresh manufacturing data from China beat expectations, sparking a rally across Hong Kong and mainland exchanges.
Japan and Korea struggles: In contrast, Japan and South Korea reported continued industrial contraction, weighing on sentiment in Tokyo and Seoul.
US tariffs ruling: Traders also reacted to news that a US federal appeals court struck down most of President Donald Trump’s reciprocal tariffs as illegal.
Geopolitical spotlight: The Shanghai Cooperation Organization (SCO) Summit, attended by more than 20 world leaders including Russian President Vladimir Putin, added to the broader political backdrop.

The US dollar traded flat against the Japanese yen, hovering around ¥147.05 in early trading.