US stock futures and Asian equities both rose after a deal was reached on the weekend to avoid a American government shutdown. Treasuries fell.

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Futures contracts on the S&P 500 climbed as much as 0.7% at the start of Asian trade after US lawmakers late on Saturday passed compromise legislation to keep the government running until Nov. 17. Japanese and Australian stocks both rose, while a number of Asian markets including China and South Korea are shut for holidays.

Investors also found a measure of relief after data over the weekend showed China’s manufacturing activity expanded for the first time in six months, adding to signs some parts of the nation’s economy are finding a footing again. South Korea reported a slower decline in exports.

“Financial markets were bracing for a shutdown, so there’s an element of relief, but it’s only a temporary lifting of one of the clouds hanging over the markets now,” said Yung-Yu Ma, chief investment officer at BMO Wealth Management. “Interest rates and Fed hawkishness remain the name of the game and the main driver of the markets over the next few weeks.”

The dollar edged lower against most of its Group-of-10 peers. Treasury yields climbed across the curve, with those on 10-year debt rising as much as five basis points to 4.62%. Five-year yields rose by a similar amount to 4.66%, approaching once more a 16-year high.

Japanese stocks were also boosted after the quarterly Tankan survey showed confidence among large manufacturers improved for a second consecutive quarter. The yen weakened toward 150 per dollar, putting it at a level that may draw further jawboning from the finance ministry.

“It’s definitely a headwind for them while the Fed is higher for longer,” Kieran Calder, head of Equity Research for Asia at Union Bancaire Privée, said on Japan’s authorities on Bloomberg Television. “Certainly we would agree that once we start to get past 155, it’s gonna be a little bit problematic.”

While markets are gaining some relief from the US deal, attention will quickly shift to Federal Reserve Chief Jerome Powell as he speaks in a discussion later Monday. US manufacturing activity and jobs data will also be in the spotlight this week after the head of the New York Fed said Friday policymakers should leave interest rates high for some time.

Stock gains on the first trading day of October may put a temporary stay on a torrid period for global financial markets. Elevated interest rates made the July-to-September quarter the worst for MSCI’s all-country stock index since September 2022 as surging oil prices added fears over inflation and slowing economic growth.

Elsewhere, oil rose on speculation global demand is running ahead of supply.