Asia markets mixed ahead of fed minutes

July 06, 2026 (MLN): Asian markets traded mixed on Monday as investors reassessed artificial intelligence-linked stocks and shifted focus to broader sectors, while awaiting the release of minutes from the U.S. Federal Reserve's June policy meeting later this week.

Japan's Nikkei 225 slipped 0.7%, while the broader Topix index edged up 0.2%. In South Korea, the Kospi fell 0.91%, whereas the small-cap Kosdaq declined 1%.

Chinese equities outperformed regional peers, with Hong Kong's Hang Seng Index rising 0.4% and mainland China's CSI 300 gaining 0.2%. Australia's S&P/ASX 200 traded largely unchanged after opening lower, according to CNBC.

Currency markets also remained in focus. The Japanese yen traded around 161.54 per U.S. dollar, hovering near its weakest level in four decades after last week's sharp depreciation.

Meanwhile, South Korea's won weakened roughly 0.25% to 1,532.82 per dollar as the country officially introduced 24-hour trading in its currency.

Investor attention is now firmly on the U.S. Federal Reserve, which is scheduled to publish the minutes of its June monetary policy meeting on Wednesday the first meeting chaired by Kevin Warsh.

Market participants are looking for clues on the central bank's outlook after interest rate expectations shifted significantly in recent weeks.

Fed funds futures now imply around 1.5 rate hikes over the next 12 months, marked a notable reversal from the aggressive rate-cut expectations that had dominated markets over the past three years.

Investors will closely examine whether policymakers broadly support this repricing.

The cautious tone in Asia followed another strong week on Wall Street, where the Dow Jones Industrial Average climbed nearly 2%, while the S&P 500 and Nasdaq Composite advanced 1.8% and 2.1%, respectively.

Despite the gains in the broader U.S. market, semiconductor stocks continued to lose momentum as investors rotated into other sectors. The VanEck Semiconductor ETF (SMH) declined 3.2% last week, extending its losses for a second consecutive week.

Market strategists noted that the ongoing rotation into sectors such as financials, healthcare and industrials has helped support broader equity indices, offsetting the recent weakness in semiconductor shares and suggesting that investor participation is becoming more diversified beyond the AI-driven rally.

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