Asian stocks rise, Shanghai Composite recovers from one-month lows

Asian stocks are on the rise with the Shanghai Composite recovering from a one-month low, despite lower odds of an aggressive Federal Reserve rate cut.

As of writing, Japan's Nikkei index is changing hands at 21,612, representing 195 points or 0.91% gain on the day. Stocks in Australia and New Zealand are also flashing 0.30% gains and Hong Kong's Hang Seng index is adding 0.19% or 54 points at 28,426.

The Shanghai Composite index, which had dropped to 2879 on Monday – the lowest level since June 18 – is now hovering at 2893, representing 0.26% gains on the day.

The US stocks eked out moderate gains in the overnight trade with the Dow Jones Industrial Average rising 0.10% and the S&P 500 index adding 0.28%.

The US President Trump ramped up pressure on the Fed by tweeting that the very misguided central bank should move now to cut rates. So far, however, Trump's comments have not had a major impact on market pricing of Fed rate cut odds.

The futures market odds of a 50-basis point cut at the July meeting rose slightly to 30%, but remain well below the high of 71% seen last Thursday.

That said, the markets are still expecting the Fed to cut rates by 25 basis points on July 31. Further, the European Central Bank is expected to cut rates by 10 basis points in September and restart the quantitative easing program later this year.

The expectation of easing by major central banks is likely helping the Asian equities stay bid.

The American dollar, however, has picked up a bid, courtesy of lower odds of aggressive Fed easing. As of writing, the Dollar Index, which tracks the value of the greenback against majors, is trading at 97.38, up 0.10% on the day, having logged gains in the previous two trading days.