Asian Stocks Rise, as Oil Falls on US-Iran Talks
Asian stocks rose, tracking Wall Street's gains, while oil prices weakened amid market optimism about the possibility of resuming US-Iran talks. The MSCI Asia Pacific Index rose 0.8%, with most stocks gaining, led by South Korea, which surged 3.4% after the S&P 500 rallied near its late-January peak, and the Nasdaq 100 extended its record winning streak to 10 straight days.
In energy commodities, Brent fell for a second day to around US$94.40/barrel after President Donald Trump said the war was "very close" to an end. The oil decline fueled a rally in US government bonds on expectations of easing inflation pressures, while the Bloomberg Dollar Index held steady after seven days of declines.
The improvement in sentiment was supported by confidence that a de-escalation of Middle East tensions would restrain energy prices, help reduce inflation risks, and open up room for growth recovery. The US and Iran are said to be seeking a second round of talks within days, although supply risks remain high due to tensions in the Strait of Hormuz and the US's continued naval blockade to restrict Iranian oil exports.
Asian assets, once most affected by the war, have begun to recover losses, reflecting growing investor confidence that tensions can ease. Taiwanese and Singaporean stocks have recouped earlier declines, the yuan recorded an eight-day winning streak through Tuesday, while gold edged down by around 0.2% to around US$4,830 per ounce.
However, the macroeconomic narrative remains overshadowed by the war's impact on the global outlook. The IEA estimates that the conflict risks depressing global oil demand growth, while the IMF lowered its global growth forecast for this year, opening up the possibility of a deeper downturn if the conflict continues and energy infrastructure is impacted. Market focus now shifts to first-quarter earnings and US inflation data, after the March PPI rose less than expected despite a surge in energy costs. (asd)
Source: Newsmaker.id
