Asian markets rally on prospects of US-Iran talks resuming
Asian shares gained after Wall Street rallied, as oil prices eased on hopes of renewed US-Iran talks, easing inflation concerns and boosting investor sentiment
Tokyo, Apr 15 (AP) Asian shares mostly rose in early Wednesday trading, echoing the rally on Wall Street that came as oil prices eased on hopes the United States and Iran may try again on talks to end their war.
Japan's Nikkei 225 gained 0.5 per cent to 58,162.84. Australia's S&P/ASX 200 was little changed, inching up less than 0.1 per cent to 8,977.90. South Korea's Kospi jumped 3.0 per cent to 6,145.18. Hong Kong's Hang Seng edged up 0.7 per cent to 26,045.80, while the Shanghai Composite gained 0.2 per cent to 4,033.88.
On Wall Street, the S&P 500 added 1.2 per cent to its leap from the day before, and the index at the heart of many 401(k) accounts is just 0.2 per cent below its record set in January.
The Dow Jones Industrial Average rose 317 points, or 0.7 per cent, and the Nasdaq composite climbed 2 per cent.
On Wednesday, benchmark US crude inched up 1 cent to USD 91.29 a barrel. Brent crude added 48 cents to USD 95.27, or less than 1 per cent after falling 4.6 per cent the day before. While that's still above its roughly USD 70 price from before the war began in late February, it's well below the peak level of USD 119.
Lower oil prices help bring down costs for all kinds of businesses. But some analysts noted the war was still ongoing, warning that the optimism may be unfortunately unfounded.
“The counterintuitive decline in crude appears driven by growing hopes that a second round of peace talks between Washington and Tehran could soon materialise, after the first attempt fizzled out. Traders are clearly choosing to price in the possibility of de-escalation rather than the immediate reality of restricted flows,” said Tim Waterer, chief market analyst at KCM Trade.
Asian nations depends on access to the Strait of Hormuz, a narrow waterway that's the main avenue for crude oil produced in the Persian Gulf area to reach customers worldwide. Blockages there have kept oil off the global market, which has in turn driven up its price.
Global inflation this year looks set to accelerate to 4.4 per cent from 4.1 per cent in 2025, according to the International Monetary Fund, which had earlier thought inflation would slow to 3.8 per cent. The IMF on Tuesday also downgraded its forecast for global economic growth to 3.1 per cent this year from the 3.3 per cent it had forecast in January.
All told, the S&P 500 rose 81.14 points to 6,967.38. The Dow Jones Industrial Average gained 317.74 to 48,535.99, and the Nasdaq composite climbed 455.35 to 23,639.08.
In the bond market, Treasury yields eased as the fall for oil prices took some of the pressure off inflation. The yield on the 10-year Treasury fell to 4.25 per cent from 4.30 per cent late Monday.
In currency trading, the US dollar edged up to 159.03 Japanese yen from 158.79 yen. The euro cost USD 1.1780, down from USD 1.1797. AP