Global Market Today | Asian stocks gain ahead of Fed rate decision, oil holds near $103

Asian equities rose at the open Wednesday after US stocks and Treasuries edged higher, signaling that investors are attempting to look through near-term geopolitical uncertainty.

Gauges opened higher in Japan and South Korea, lifting the broader MSCI Asia Pacific Index by 0.8% and putting it on track for a third straight day of gains. That came after the S&P 500 rose 0.3% and the Nasdaq 100 gained 0.5% on Tuesday, marking a second straight day of advances and suggesting cautious optimism despite the conflict in the Middle East.

Brent crude was little changed, trading at around $103 a barrel. Treasuries were steady on Wednesday, after gaining slightly across the curve during the US session as the 10-year yield fell two basis points to 4.20%, suggesting easing inflation concerns.


The near shutdown of the Strait of Hormuz has rattled energy markets, with the shock reverberating across stocks and bonds amid concern that surging oil prices will stoke inflation. How policymakers respond is now top of mind for investors, especially with the Federal Reserve set to deliver its interest-rate decision later Wednesday.

“There is a growing sense that markets are trying to look through the current tensions,” said Fawad Razaqzada at Forex.com. “Still, markets aren’t getting carried away. If the conflict drags on, the risk is that it starts to weigh more heavily on stock markets again.”

In geopolitical news, President Donald Trump abandoned his effort to recruit partners for the war and scolded allies who openly rejected his appeals, even as he repeated claims the conflict would end soon.

Israel said it killed Iran’s security chief, Ali Larijani. The development came after Tehran set a massive natural gas field in the United Arab Emirates ablaze overnight. Trump threatened to expand strikes on Kharg Island, Iran’s main export hub.

Meanwhile, Russia is sharing satellite imagery and drone technology with Iran, the Wall Street Journal reported.

“Investors should expect continued volatility until the energy situation stabilizes,” said veteran strategist Louis Navellier. Gains for US stocks despite higher oil prices reflect expectations for solid earnings and economic growth, he said.

In other corners of the market, a gauge of the greenback fell for a third consecutive day. The yen was fractionally stronger early Wednesday at around 159 per dollar. In commodities, gold was little changed at around $5,000 an ounce. Bitcoin traded around $74,000.