BY COMFORT OGBONNA
Asian markets opened slightly higher on Tuesday as investors followed gains in global equities, while oil prices remained near recent lows amid uncertainty surrounding the ongoing U.S.-Iran tensions.
MSCI’s broadest index of Asia-Pacific shares outside Japan gained 0.1% at the start of trading, supported by strength in South Korean stocks, which climbed as much as 2.1%. Japan’s Nikkei 225 index moved in the opposite direction, slipping 0.3%, while U.S. stock futures pointed to a modestly positive opening on Wall Street.
Investor sentiment was supported by stronger-than-expected U.S. economic data showing manufacturing activity reached its highest level in more than four years in July. The report helped lift confidence in the global economic outlook and pushed the Dow Jones Industrial Average to a record closing high in the previous session.
Market participants said improving conditions in U.S. and European equities have encouraged investors to take on more risk, with expectations that positive momentum could continue across Asian markets.
“Risk markets have clearly turned a corner,” said Chris Weston, head of research at Pepperstone Group. He added that continued strength in major global equity markets could encourage buyers to return to regional assets.
Oil prices showed limited movement after falling to their lowest level in about three weeks during the previous session. Brent crude futures rose 0.6% to $84.29 a barrel after declining following comments from U.S. President Donald Trump that he had delayed further action against Iran as part of efforts toward a possible diplomatic resolution.
Iran has denied that formal negotiations are taking place, adding uncertainty over the outlook for tensions in the region and the potential impact on global energy supplies.
Currency markets also reflected ongoing shifts in investor expectations. The U.S. dollar strengthened 0.3% against the yen, trading at 157.625 yen after recovering from losses following coordinated efforts by U.S. and Japanese authorities to support the Japanese currency.
The dollar index, which measures the greenback against a basket of major currencies, remained near its lowest level in two months at 99.99.
U.S. Treasury yields edged higher, with the benchmark 10-year Treasury yield rising 0.2 basis points to 4.684%.
Investors continued to monitor expectations for the Federal Reserve’s next policy decision. Market pricing suggested traders are assigning a significant probability to an interest rate increase at the central bank’s September meeting, with futures markets indicating a 65% chance of a 25-basis-point hike by the conclusion of the Fed’s two-day meeting on Sept. 16.
New York Federal Reserve President John Williams said he remained confident that inflation pressures would gradually ease but warned that additional rate increases could be necessary if price growth does not slow as expected.
In digital asset markets, cryptocurrencies moved lower. Bitcoin declined 0.5% to $63,446.35, while ether also fell 0.5% to $1,857.44 as investors continued to assess broader market conditions and monetary policy expectations.
Markets are expected to remain focused on developments in energy prices, central bank decisions, and geopolitical risks as investors assess the outlook for global growth.
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