HONG KONG - Markets saw a limp start on Monday as traders turned more cautious after last week's rally, with eyes on China as speculation grows that officials will unveil a raft of economic stimulus measures.
The Federal Reserve's decision to pause its rate hikes and Beijing's cut in borrowing costs provided a much-needed boost to sentiment, helping push equities higher last week.
While officials have not made any announcements, there is an expectation that officials will provide help for the struggling property sector and measures to kickstart consumer activity, among other things.
With the global economy continuing to struggle and key industries still in trouble, world leaders have plenty of work to do, analysts said.
After Wall Street closed Friday in the red, Asian traders struggled.
Hong Kong, Shanghai, Singapore, Taipei, Manila, Jakarta and Wellington were all down, though Tokyo eked out a small gain.
On a positive note, hopes for a thaw in China-US relations were boosted as US Secretary of State Antony Blinken held talks with China's top envoy Wang Yi in Beijing on Monday, with a meeting with Xi potentially in the works.
Blinken on Sunday held "candid" discussions for seven and a half hours with Chinese Foreign Minister Qin Gang and agreed to keep up communication as they look to avoid conflict.
Traders are also keeping tabs on comments from Fed officials after last week's decision to hold rates.
Several decision-makers lined up Friday to offer their views on the next move as they try to bring inflation down.
Investors will be closely watching Fed chief Jerome Powell's twice-yearly testimony to Congress this week, hoping for clues about the policy board's thinking.
On currency markets, the yen continued to struggle after the Bank of Japan on Friday stood pat on its ultra-loose monetary policy.
The unit was wallowing at a 15-year low against the euro, the BoJ decision coming a day after the European Central Bank hiked rates again and warned of more to come.