SINGAPORE — Asian stocks drifted higher and the dollar steadied on Monday, with markets weighing the Federal Reserve’s monetary policy path after a rate cut last week, while President Donald Trump’s immigration crackdown on worker visas kept sentiment in check.
India’s benchmark index (.NSEI) (.BSESN) slipped after the Trump administration said on Friday it would ask companies to pay $100,000 for new H-1B worker visas, a blow to the tech sector that relies on skilled workers from India and China.
US stock futures eased with the S&P futures down 0.1 percent, while European futures indicated a subdued open.
MSCI’s broadest index of Asia-Pacific shares outside Japan was 0.1 percent higher. Tokyo’s Nikkei rose 1.3 percent and Taiwan stocks gained more than 1 percent to a record high.
India’s $283 billion information technology sector, which gets more than half of its revenue from the US, will likely feel the pain in the near term amid souring ties between India and the United States.
Trump last month doubled tariffs on imports from India to as much as 50 percent, partly due to New Delhi’s purchases of Russian oil.
“It’s a risk to operating costs and margins first of all. Obviously it could raise wages and labour costs a bit,” said Kyle Rodda, senior financial analyst at Capital.com
“Tech companies may also find themselves in a bind where they confront punitive measures if they look to offshore labor because they can’t find enough workers in the US.”
In China, stocks were choppy as investors digested positive signals from US-China talks after Trump said he and Chinese President Xi Jinping made progress on a TikTok agreement.
On the macroeconomic front, investors remain keen to gauge the US monetary policy path after the Fed indicated a gradual easing phase in the future, with traders pricing in 44 basis points of easing in the two policy meetings left for the year.
A host of policymakers are expected to speak in the week, while data on the Fed’s preferred gauge of inflation is due on Friday that will help set the tone for the near-term rate outlook.
