Asian stock markets are poised for a strong start this week, with Asian currencies also likely to gain support. Wall Street analysts point out that Asian stocks and currencies are expected to strengthen further. This follows Federal Reserve Chairman Powell's speech at the Jackson Hole symposium, which indicated that the Fed could implement rate cuts as early as its next policy meeting in September.

On Friday, U.S. stocks surged significantly, pushing the Dow Jones Industrial Average to a new high for the year. Meanwhile, emerging market currencies ended a six-day losing streak as Powell's remarks led to substantial dollar weakness.

Here are the views from analysts and strategists:

Gerald Gan, Deputy Chief Investment Officer at Reed Capital Singapore, stated: "If the market's enhanced expectations for rate cuts intensify further before the September Federal Open Market Committee meeting, then Asian stocks overall will certainly be boosted. As long as the yen's appreciation remains controlled, its impact on Japanese risk assets won't be too severe. Given that the Bank of Japan is closely monitoring yen movements, I expect future yen volatility to be limited, which again suggests that Japanese stocks may continue rising next year."

Priyanka Kishore, Chief Economist at Asia Decoded, noted: "Dollar weakness may temporarily boost Asian currencies as Powell indicated possible rate cuts in September. However, unless the Fed commits to more aggressive easing policies, any gains may only be temporary."

Hebe Chen, analyst at Vantage Markets, said: "Powell's signal of 'wishes becoming reality' will help fill the cracks beneath the somewhat volatile surface of Asian markets. While this signal doesn't guarantee durability, this boost will be most evident in tech-dominated sectors and markets like Japan and Taiwan, where market sentiment is more fragile. For investors, this new optimism will likely maintain high risk appetite until September 17."

Jamie Halse, CEO of Senjin Capital, believes: "In the short term, this could be favorable for global markets as it means capital will flow away from the U.S. to seek higher return opportunities elsewhere, with the dollar weakening accordingly. Lower rates typically make dollar investments less attractive when rates in other regions remain unchanged. This is why the dollar usually falls when U.S. rates decline. Lower U.S. rates, combined with Ueda's continued hawkish stance, means the yen will strengthen against the dollar. This will hurt earnings of large exporters and companies with substantial overseas profit reserves, but will benefit smaller domestic-focused companies with dollar-denominated overseas purchases."

Anna Wu, Cross-Asset Strategist at VanEck Associates, considers: "Powell's speech took a moderate stance, removing obstacles to September rate cuts and boosting market risk sentiment. This is favorable for both equity and short-term bond markets. In my view, Japanese stocks will rise due to improved market sentiment. However, NVIDIA's earnings and PCE data this week will be crucial to test whether this rally can sustain. The yen may appreciate modestly against the dollar as the Jackson Hole meeting drove yield increases."

Tim Waterer, Chief Market Analyst at KCM Trade, stated: "At Jackson Hole, the Fed Chairman's remarks appeared moderate rather than hawkish, which was a boon for risk asset markets. The prospect of declining U.S. rates may prompt investors to seek yields elsewhere, which could be good news for Asian economies."

Marito Ueda, Head of Research at SBI Liquidity Market, wrote: "Powell's speech seemed to hint at possible September rate cuts, but he wasn't definitively supportive of cuts, only indicating it would depend on data. The dollar-yen rate rose because markets expected hawkish statements, so it subsequently fell by the same magnitude. I don't think the dollar-yen rate will break out of its trading range."

Kazuya Fujiwara, Fixed Income Strategist at Mitsubishi UFJ Morgan Stanley Securities, pointed out: "Japanese government bond prices may remain stable due to declining U.S. rates, but upside is limited as markets expect Bank of Japan rate hikes while concerns about fiscal expansion intensify. Ueda's remarks about 'persistent wage growth pressures' during panel discussions will likely be interpreted as signals that the BOJ will continue raising rates."

Yusuke Matsuo, Senior Market Economist at Mizuho Securities, stated: "The Bank of Japan is considering rate hikes while the Fed is considering cuts, so these two central banks will very likely diverge in policy rate directions. Foreign exchange markets are expected to gradually move toward yen appreciation and dollar depreciation, reflecting market expectations that the BOJ will conduct one more rate hike this year while the Fed will implement two rate cuts."

Steven Englander, Head of Global G10 FX Research at Standard Chartered Bank, added: "Unless Powell was confident that the Federal Open Market Committee would very likely lower rates, he would never have made such remarks. There's no point in raising market expectations only to disappoint them. For markets, the question is what level of non-farm payrolls would prevent rate cuts, and how low non-farm payrolls would need to fall to justify a 50 basis point cut."