Precise Investors Editorial Team
MSCI’s broadest index of Asia-Pacific shares outside Japan was up 0.1%
Asian markets made cautious gains at the start of trading as investors followed a worldwide rally, with oil prices holding near the lowest levels in weeks as the Iran-U.S. war remained at a stalemate.
MSCI’s broadest index of Asia-Pacific shares outside Japan was up 0.1%, led by South Korean shares rallying 2.1%. Nikkei 225 slipped 0.3%.
Risk markets have clearly turned a corner, said Chris Weston, head of research at Pepperstone Group in Melbourne. If the constructive tone from European and U.S. equity markets carries through, buyers should emerge early in the session and provide support for regional risk assets.
Oil prices made limited gains as trading resumed in Asia, with Brent crude up 0.6% at $84.29 a barrel, after dropping to a three-week low on Monday as U.S. president said he had held off an attack on Iran as a gesture of goodwill in peace talks. However, Tehran has denied that any negotiations are taking place.
Against the yen, the dollar was up 0.3% at 157.625 yen.
Elsewhere, the U.S. dollar index was pinned near the lowest levels of the past two months at 99.99.
The yield on the U.S. 10-year Treasury bond was up 0.2 basis point at 4.684%.
Market pricing continues to indicate that September’s U.S. central bank meeting will bring an increase to interest rates. Fed funds futures are pricing an implied 65% probability of a 25-basis-point hike at the central bank’s next two-day meeting ending on September 16, according to the CME Group’s FedWatch tool.
Federal Reserve Bank of New York President John Williams said he remained optimistic that inflation pressures are on track to ease gradually, but said the Fed will hike rates if inflation doesn’t slow.
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