• Asian equities trade higher amid the light volume due to holidays in China and India.
• Chinese Caixin/S&P Global Manufacturing PMI dropped to 50.6 in September vs. 51.0 prior.
• BoJ Governor Kazuo Ueda said that there was "a distance to go" for BoJ before exiting its ultra-loose monetary policy.
• The Reserve Bank of India (RBI) is likely to maintain a status quo on interest rates on Friday.

Asian stocks posts modest gains on Monday amid the light trading volume. Investors digest economic data from China and Japan while awaiting the US PMI data due later in the American session on Monday.

Chinese markets are closed for the Golden Week holiday. Stock markets in Hong Kong and India are also closed for holidays. At press time, Japan’s Nikkei is up 0.55% to 32,025, while the Topix rose 0.45%.

In China, data released on Saturday showed that the Chinese Caixin/S&P Global Manufacturing Purchasing Managers' Index (PMI) dropped to 50.6 in September from the previous reading of 51.0, below the market consensus of 51.2. The Service PMI came in at 50.2 from 51.8 in the previous month. These figures indicated a sign of stabilization in the world's second-largest economy. However, the future is clouded by a housing downturn and plummeting exports.

Earlier Monday, BoJ Summary of Opinions at the Monetary Policy Meeting on September 21 and 22 stated that BOJ does not need to make additional tweaks to YCC as long-term rates moving fairly stably and said that end to negative rate must be tied to the success of achieving 2% inflation target. One board member added that given recent FX and oil price moves, there is a chance inflation may not slow much and overshoot expectations.

BoJ Governor Kazuo Ueda said on Saturday that there was "a distance to go" for BoJ before exiting its ultra-loose monetary policy. Japan’s overall business conditions of the large manufacturing companies in Japan improved in the third quarter (Q3). The Japanese Tankan Large Manufacturing Index (Q3) came in at 9.0 from the previous reading of 5.0, better than the expectation of 6.0.

Apart from this, BoJ announced on Monday an unscheduled purchase of the Japanese government bonds (JGB), to slow down the ongoing surge in in yields. The 10-year JGB yield hit the highest level since September last year at 0.775% in the early Asian session.

In India, the Reserve Bank of India (RBI) will begin its three-day meeting on Wednesday and the interest rate decision will be announced on Friday. RBI is likely to maintain a status quo on interest rates for the fourth consecutive time at its upcoming monetary policy meeting