• Scott Bessent's appointment as U.S. Treasury Secretary has led to a rally in global markets.
• Asian stocks and U.S. equity futures have risen, while the dollar has retreated against rivals.
• Bessent's 'safe hands' reputation has brought relief to the markets, with positive responses from Japan, South Korea, and Australia.
• The markets are now closely watching the next moves by the incoming U.S. administration and the new Treasury Secretary.

The global financial landscape has been significantly impacted by the recent appointment of Scott Bessent, a renowned fund manager, as the next U.S. Treasury Secretary. This development has led to a rally in Asian stocks and U.S. equity futures, while the dollar has retreated against its rivals. Investors are optimistic that Bessent will be a strong advocate for markets in Washington.

The MSCI's broadest index of Asia-Pacific shares climbed 1.6% as of 0143 GMT, and U.S. S&P 500 futures pointed 0.5% higher, just shy of a record high. This comes after a 0.3% gain for the cash index at the end of last week. The announcement of Bessent's appointment came late on Friday, after Wall Street had closed for the day.

The dollar's retreat was marked by a 0.7% drop against the yen and a 0.6% fall versus the euro. This was triggered by traders snapping up Treasuries, which led to a decrease in the benchmark U.S. long-term yield by about 7 basis points to as low as 4.341% on Monday.

Market Response to Bessent's Appointment

Stephen Spratt, a strategist at Societe Generale, described Bessent as a 'safe hands' candidate, a sentiment that has brought relief to the markets. The risk of a more unorthodox pick was effectively priced out of the markets.

Asian markets responded positively to this development. Japan's Nikkei jumped 1.6%, South Korea's Kospi climbed 1.5%, and Australia's share market rose 0.7%, reaching a record high. However, Chinese markets were weighed down by the threat of massive tariffs under the incoming Donald Trump administration and underwhelming stimulus announcements from Beijing. Hong Kong's Hang Seng added 0.2%, while mainland blue chips eased 0.2%.

The week's trade is expected to be light due to Thursday's Thanksgiving holiday in the United States. The appointment of a Treasury Secretary by President-elect Trump has been closely watched in bond markets. Expectations of tax cuts, tariffs, and an immigration crackdown have stoked fears of inflation and big deficits.

Bessent's Views and Market Impact

Bessent, in an interview with CNBC earlier in November, before his selection as Treasury Secretary, stated that he would recommend tariffs be layered in gradually. He has advocated for the U.S. to grow its way out of large debts and called for tax reform and deregulation, particularly to spur bank lending and energy production. Bessent has spent his career working for billionaire investor George Soros and noted short seller Jim Chanos, as well as running his own hedge fund.

In the currency market, the yen last stood at 153.76 per dollar. The currency pair tends to closely follow moves in Treasury yields. The euro changed hands at $1.0477, rebounding from Friday's two-year trough at $1.03315. Sterling climbed 0.5% to $1.2592. On Friday, it slumped to the weakest since early May at $1.2475. The Aussie dollar bounced 0.6% to $0.6538 and the kiwi, which slid to a one-year low on Friday on increasing bets on a dovish central bank, jumped 0.5% to $0.5865.

Bitcoin ticked up slightly from Sunday to $97,511. On Friday, it reached a record peak of $99,830 amid expectations of a more friendly regulatory environment for cryptocurrencies under Trump. The token is up about 45% since Trump's sweeping election victory on Nov. 5, when voters also elected a slew of pro-crypto lawmakers to Congress.

In the commodities market, crude oil hovered near two-week highs as geopolitical tensions heightened between Western powers and major oil producers Russia and Iran, raising risks of supply disruption. Brent crude futures climbed 0.2% to $75.30 a barrel, while U.S. West Texas Intermediate crude futures were at $71.38 a barrel, up 0.2%. Both benchmarks rallied about 6% last week.