Asian equity markets opened Thursday with a split picture, reflecting the latest swings in oil prices and U.S. Treasury yields. Investors in Tokyo saw the benchmark Nikkei 225 climb 1.3% to 65,883.41, helped by a rally in semiconductor firms that are benefiting from heightened demand for artificial intelligence applications.
In contrast, the Australian S&P/ASX 200 slipped 0.7% to 8,700.50, and Hong Kong’s Hang Seng fell 0.5% to 24,715.95. The Shanghai Composite also dipped, down 0.8% to 3,902.33. Trading was closed in South Korea for the Chuseok autumn harvest holiday.
Energy prices ease
U.S. benchmark crude oil dropped 0.82% to $91.40 a barrel, while Brent crude fell 0.83% to $102.22. Although Brent remains well above the roughly $72 level seen before the conflict with Iran began, the modest decline offers some relief to oil‑importing economies in the region.
Analysts note that ongoing diplomatic talks between U.S. and Iranian officials have yet to produce a concrete resolution, keeping the market wary of a prolonged supply squeeze.
U.S. bond market pressure ripples through Asia
Wall Street faced renewed pressure from the U.S. Treasury market after a surprisingly strong preliminary report on business activity suggested the economy is expanding at its fastest pace in more than five years. The S&P 500 slipped 0.8%, the Dow Jones Industrial Average dropped 352 points (0.7%), and the Nasdaq composite fell 1.1% from its recent highs.
Most notably, the yield on the 10‑year Treasury jumped to 5.10% from 4.96%, a level not seen since early 2007. Higher yields tend to make borrowing more expensive, which can dampen corporate investment and consumer spending, and they also weigh on equity valuations.
Implications for Asian investors
Higher U.S. yields have a direct impact on Asian markets by raising the cost of capital for multinational firms and by strengthening the dollar, which can pressure export‑oriented economies. The U.S. dollar edged down slightly to 157.94 yen, but the yen remains weak, a factor that continues to challenge Japan’s oil‑importing industries.
Despite the broader headwinds, the AI‑driven chip sector provided a bright spot for the Japanese market, underscoring the growing importance of technology innovation in regional growth strategies.
Looking ahead
Market participants will watch for further developments in the U.S. inflation outlook, Federal Reserve policy, and the outcome of diplomatic efforts with Iran. Any shift in these areas could quickly translate into renewed volatility across Asian equity and currency markets.
Original reporting: Alexandria, VA News – WTOP News — read the source article.
