Asia Rides AI-Led Risk Appetite Despite Rising Geopolitical Tensions

Here’s your quick read to start the day: a chatty, no-fuss look at overnight moves, the big story, what’s on the docket, and the tickers you need to watch.

By Richard Fargose

December 23, 2025 at 1:53 AM IST

GLOBAL MOOD: Risk-on
Drivers: Geopolitical Escalation, Venezuela Energy Leverage

Asia-Pacific markets are in a risk-on mood, lifted by a renewed AI-led rally in US equities, optimism around Nvidia’s China shipments, and softer US inflation supporting Fed cut expectations. However, rising US–Venezuela tensions and higher oil prices are tempering enthusiasm, keeping investors selective despite improving growth signals.

TODAY’S WATCHLIST
- US Jul-Sep GDP Data
- US Oct Core PCE Prices Data
- Atlanta Fed GDPNow

THE BIG STORY
Donald Trump said on Monday it would be “smart” for Nicolas Maduro to step down, as Washington intensifies pressure on Venezuela following the seizure of oil tankers off its coast. Trump indicated the United States could either keep or sell the confiscated oil, underscoring a hardening stance that includes a stepped-up US military presence and dozens of strikes on vessels accused of drug trafficking in nearby waters. The campaign marks one of the most aggressive phases yet in US efforts to isolate Caracas.

Separately, Trump renewed his assertion that the United States “needs” Greenland for national security, appointing Louisiana Governor Jeff Landry as special envoy to the Arctic island. The move has drawn fresh criticism from Denmark and Greenland, as Trump again highlighted the territory’s strategic location and mineral wealth, reviving a controversial geopolitical ambition that has unsettled European allies.

Data Spotlight
The Chicago Fed National Activity Index improved to -0.21 in September 2025 from -0.31 in August, according to delayed data, pointing to a milder contraction in overall economic activity. While the index has now remained in negative territory for six consecutive months, the improvement was supported by firmer production indicators. However, momentum remained mixed, with the sales, orders and inventories component weakening slightly and personal consumption and housing also deteriorating. A notable positive came from employment-related indicators, which turned marginally positive at +0.01, after weighing heavily in August (-0.11).

Takeaway: US economic activity remains below trend, but the pace of slowdown appears to be easing. Improving labour indicators offer some reassurance, even as demand-side sectors stay soft.

WHAT HAPPENED OVERNIGHT

US stocks advance as tech rally extends
- US equities started the holiday-shortened week on a positive note, with stocks closing higher on Monday amid broad-based gains.
- Technology shares continued their rebound from late last week, helping lift nearly all 11 S&P 500 sectors.
- Cooler-than-expected inflation data and Micron Technology’s upbeat outlook supported sentiment, leaving the S&P 500 and Dow less than 1% below their record highs set on December 11.
- Nvidia shares rose and provided the biggest boost to the S&P 500 after reports it plans to resume shipments of advanced AI chips to China ahead of the Lunar New Year.

US Treasury yields edge higher ahead of heavy supply
- The 10-year US Treasury yield rose to around 4.16%, rebounding from two-week lows touched last week.
- Investors positioned ahead of a busy auction slate, starting with a $69 billion 2-year note sale on Monday, followed by $70 billion in 5-year notes on Tuesday and $44 billion in 7-year notes on Wednesday.
- Policy signals remain mixed, with Cleveland Fed President Hammack favouring a pause to assess the impact of past easing, while Governor Miran said further cuts may be justified as inflation cools.
- President Trump’s calls for looser monetary policy continue to add a dovish undertone to rate expectations.

US Dollar slides on Fed cut bets and Yen strength
- The dollar index rose slipped below 98.4, drifting closer to October lows amid expectations of further Fed easing.
- Markets are now pricing in two US interest-rate cuts in 2026, reinforced by President Trump’s calls for lower borrowing costs.
- Fed officials remain divided: Cleveland Fed President Hammack signalled comfort with a pause, while Governor Miran argued inflation cooling supports more easing.
- Dollar softness was compounded by a rally in precious metals, reflecting safe-haven demand amid rising US–Venezuela geopolitical tensions.

Crude oil prices climbed on renewed geopolitical supply risks
- US Coast Guard attempted to intercept an oil tanker near Venezuela, highlighting tighter enforcement of sanctions.
- Ukraine damaged two vessels and port facilities in Russia, raising concerns over potential disruptions to oil logistics.
- Brent crude rose $1.60, or 2.7%, to settle at $62.07 per barrel, while WTI crude gained $1.49, or 2.6%, to close at $58.01 per barrel.

Day’s Ledger

Economic Data

BoJ Core CPI
US Jul-Sep GDP Data
US Oct Core PCE Prices Data
US Sep Housing Starts Data
Oct Durable Goods Orders
Nov Industrial Production
ADP Employment Change Weekly

Corporate Actions

Granules India to consider fund raising
NIBE to consider fund raising
Onelife Capital Advisors to consider fund raising

Policy Actions

Atlanta Fed GDPNow

Tickers to Watch

AMBUJA CEMENTS approved merger of ACC and Orient Cement into Ambuja to create a single consolidated cement platform.
BELRISE INDUSTRIES signed an exclusive teaming and strategic agreement with Israel-based Plasan SASA for technical and business cooperation.
CANARA BANK said FSIB has recommended Brajesh Kumar Singh for appointment as MD and CEO.
GPT INFRAPROJECTS emerged L1 for an NHAI HAM project worth ₹6.7 billion to build a four-lane elevated road in Jodhpur.
HCL TECHNOLOGIES said HCLSoftware plans to acquire embedded analytics firm Jaspersoft from Cloud Software Group for $240 million.
LENSKART SOLUTIONS subsidiary acquired a 50% stake in Marco Optical (Thailand), making it a joint venture with Matt Optical.
LLOYDS ENTERPRISES announced a restructuring plan to consolidate real estate assets and demerge them into a newly listed Lloyds Realty.
OLA ELECTRIC MOBILITY used promoter share monetisation proceeds to repay debt, fully releasing promoter pledges of ~3.93% equity.
PRESTIGE ESTATES PROJECTS acquired 25 acres in Medavakkam, Chennai, with ~5 million sq ft development potential and revenue estimate above ₹50 billion.
SAATVIK GREEN ENERGY unit Saatvik Solar Industries received a solar PV module supply order worth ₹4.86 billion from an IPP/EPC player.
SANGHVI MOVERS subsidiary Sangreen Future Renewables secured renewable energy work orders worth ₹4.29 billion from IPPs.
SUPREME PETROCHEM temporarily shut its new mABP plant at Amdoshi due to malfunction of critical equipment.
VIKRAN ENGINEERING cancelled a Letter of Award worth ₹16.42 billion.

MUST READ

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