Asian stocks on Monday made a steady start to the final month of 2025 as US rate-cut optimism lifted risk sentiment ahead of economic data while the Japanese yen firmed, with investors weighing the prospect of a near-term rate hike.

In Hong Kong, the benchmark Hang Seng Index gained 86 points, or 0.34 percent, to open at 25,945.

Across the border, the benchmark Shanghai Composite Index was up 0.14 percent at 3,894, while the Shenzhen Component Index was 0.42 percent up at 13,038.

The ChiNext Index, which tracks China's Nasdaq-style board of growth enterprises, was up 0.26 percent at 3,060.

The spotlight in the currency market has been on the yen, which strengthened to 155 per US dollar as Bank of Japan governor Kazuo Ueda took the stage in Nagoya, with investors parsing his comments for cues on the timing of the next hike.

Ueda said in a speech to business leaders that the central bank would consider the pros and cons of raising interest rates at its next policy meeting in December.

In stocks, MSCI's broadest index of Asia-Pacific shares outside Japan was steady at 703, having gained 23.5 percent so far this year and on course for its best annual gain since 2017. Japan's Nikkei fell 1.3 percent in early trading.

"The risk bulls roll into December feeling positive about directional bias," said Chris Weston, head of research at Pepperstone.

"As the clouds of worry that cast an ominous shadow over markets through to mid-November gently dissipate, they give way to new emotions – notably the fear of not participating and the risk of underperforming benchmark targets."

Investor focus this week will be on US economic releases that cover manufacturing and services activity as well as consumer sentiment.

"With the US data void finally being filled and a busy economic calendar ahead, December looks set to be a merry one for volatility hunters," said Matt Simpson, senior market analyst at StoneX in Brisbane.

He said if the incoming data signal a slowdown without tipping into recession then sentiment will likely stay buoyant while the US dollar weakens, as it typically does at this time of year.

Investors will watch out for comments from US Federal Reserve chairman Jerome Powell later in the day as they look for clues on what the Fed will do later this month.

Dovish comments from policymakers have convinced investors that a rate cut is on the cards. Traders are pricing in an 87 percent chance of a cut later in the month.

Attention will also be on early indications about holiday consumer spending as data from Black Friday and Cyber Monday retail sales events trickle in.

US shoppers spent a record US$11.8 billion online, up 9.1 percent from 2024 on Black Friday, according to Adobe Analytics, which tracks one trillion visits that shoppers make to online retail websites. (Reuters/Xinhua)