Asian Markets Rally as U.S. Shutdown Nears End, Gold and Nasdaq Surge

Asian stocks climbed on Tuesday, supported by optimism that the U.S. government shutdown may soon end. The relief rally followed a strong overnight performance on Wall Street and a sharp jump in gold prices.

Gold soared nearly 3%, trading above $4,100 in the Asian session, while the Nasdaq surged 2.3%, rebounding from last week’s losses caused by concerns over AI company valuations and profitability. South Korea’s Kospi gained 1.3%, and Japan’s Nikkei rose 0.4%, recovering from prior declines. However, Hong Kong and mainland Chinese markets edged slightly lower by mid-morning. S&P 500 futures remained steady.

Investor sentiment improved after the U.S. Senate approved a deal to restore federal funding, potentially ending the nation’s longest shutdown. The bill now heads to the House, where Speaker Mike Johnson aims for a Wednesday vote before sending it to President Donald Trump. Prediction markets, including Polymarket, have almost fully priced in a government reopening by week’s end.

Vasu Menon, managing director for investment strategy at OCBC in Singapore, noted that markets were “breathing a sigh of relief” as the shutdown nears resolution. He added that the return of economic data publication could pave the way for potential U.S. interest rate cuts, boosting gold demand further.

On Wall Street, the S&P 500 jumped 1.54%, its biggest one-day gain since October, while the Nasdaq logged its strongest session since May. Meanwhile, the yen weakened to 154.49 per dollar — its lowest level since February — as traders shifted toward riskier assets.

U.S. Treasury yields briefly hit 4.147% before easing to 4.11%. ANZ strategist Jack Chambers said markets had anticipated the shutdown’s end, minimizing long-term rate impacts.