(Bloomberg) — Asian stocks opened higher as focus shifted to a slew of company earnings and economic data this week for insight into the direction of central bank policy.

Benchmarks in Japan, Australia and South Korea all rose more than 1% early Monday, partially recovering after last week’s slump. The dollar was slightly weaker as traders took some comfort in the absence of further escalation from Iran following Israel’s retaliatory strike.

The rebound comes after traders last week were whipsawed by Middle East tensions as well as hawkish comments from Federal Reserve officials indicating reluctance to cut rates anytime soon. US growth and Fed’s preferred measure of inflation are due this week, which will help finesse bets on timing of rate cuts. Investors must also absorb a hefty slate of Treasuries auctions.

Also in focus in the region for Monday is China’s loan prime rates.

The Fed has entered its media blackout period and “the market often softens its Fed expectations during this quiet period,” said Win Thin, global head of markets strategy at Brown Brothers Harriman in New York. “However, the Fed has been sending a consistently hawkish message in recent weeks and markets would do well not to forget that.”

Read More: Fed Resets Clock on Cuts and Questions If Rates Are High Enough

The S&P 500 saw its worst week since March 2023 last week — extending a drawdown from its all-time high to more than 5%. After the gauge’s strongest start to a year since 2019, investors have been increasingly skeptical about how much further the market could go over the near term, even accounting for the continued strength in the economy.

More than half of the “Magnificent Seven” cohort of tech megacaps will report earnings this week — leaving investors wondering whether those firms are going to live up to the high expectations set for artificial intelligence. Profits for the seven biggest growth companies in the S&P 500 — Apple Inc., Microsoft Corp., Alphabet Inc., Amazon.com Inc., Nvidia, Meta Platforms Inc. and Tesla Inc. — are on course to surge 38% in the first quarter, according to Bloomberg Intelligence. When excluding them, the rest of the benchmark index’s profits are anticipated to shrink by 3.9%.

Meantime, conflicts in the Middle East and Ukraine continue to simmer. Ukrainian authorities were jubilant at the approval in the US House of more than $60 billion in aid, with President Volodymyr Zelenskiy vowing the funds will help retake the initiative in its fight against Russia’s invasion.

The limited Israeli strike on Iran and the muted response from the Iranian leadership potentially provide an opportunity for the conflict between the long-term adversaries to scale back, for now, according to RBC Capital Markets.

“It is far from an easy truce and could be tested once again as the broader Middle East backdrop remains fraught, even if the worst outcome did not come to pass,” Helima Croft, head of global commodity strategy at RBC, wrote in a note to clients. “The last two weeks have shown that this war can take sudden escalatory turns and that opposing sides may lack a cogent understanding of the other’s red lines, thereby risking a fog of war dynamic.”

Oil fell after its first back-to-back weekly decline this year as traders weighed the potential next steps from Iran and Israel. Gold slipped.

Elsewhere this week, inflation readings in Australia and Malaysia are due. Bank Indonesia will give a policy decision just as the currency comes under pressure, while earnings at global growth bellwether Caterpillar are due.

Key events this week:

Some of the main moves in markets:

Stocks

Currencies

Cryptocurrencies

Bonds

Commodities

This story was produced with the assistance of Bloomberg Automation.

–With assistance from Michael G. Wilson, Richard Henderson and Tassia Sipahutar.

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