Morning Wrap (03.01.2025)

Asian markets edged higher on Friday led by strong gains in South Korea, with the KOSPI jumping nearly 2% after new investment policies were announced. Japanese markets remained closed for holidays, while China's CSI 300 traded flat and Hong Kong's Hang Seng rose 1% amid fresh stimulus hopes.

South Korean political crisis deepened as authorities entered President Yoon's compound to execute an arrest warrant following his impeachment. The government announced measures to attract foreign investment and stabilize markets amid declining consumer confidence and economic uncertainty.

China announced plans to sharply increase ultra-long treasury bond funding in 2025 to boost investment and consumption. Special bonds will fund initiatives including consumer subsidies for digital products and durable goods trade-ins, as Beijing ramps up fiscal stimulus.

U.S. President Biden has decided to block Nippon Steel's proposed purchase of U.S. Steel, the Washington Post reported, despite the Japanese firm offering government veto power on domestic production decisions. The move comes weeks before Trump's inauguration, who had vowed to block the deal.

South Korea extended inspections of all 101 Boeing 737-800 jets through January 10 following Sunday's Jeju Air crash that killed 179 people. Transport ministry and GE are investigating why landing gear wasn't deployed before the plane attempted a rushed second landing after reporting a bird strike.

Chinese yuan hit its weakest level in nearly 16 months after PBOC signaled rate cuts from current 1.5% level "at an appropriate time" in 2025. The central bank aims to transition toward a more conventional monetary policy structure as previous liquidity measures failed to stimulate growth.

Gold edged up 0.2% to $2,662.94, on track for 2% weekly gain despite dollar strength. Copper remained subdued at $8,815.50 after disappointing Chinese manufacturing data, though markets await fresh stimulus measures. Iron ore traded below $100/ton on China growth concerns.

Bitcoin rose 1.2% to $96,852 while Tether faced pressure from EU's new crypto regulations. The stablecoin's market cap dropped 1.4% to $137 billion, its worst decline since the 2022 FTX crash, as several European exchanges removed it over compliance concerns.

Oil extended gains with Brent up 0.3% to $76.15 and WTI at $73.38, hitting two-month highs on stimulus hopes. Tesla reported record China sales of 657,000 units in 2024, up 8.8%, though global deliveries fell for first time amid rising competition from BYD.