Key facts
- Asian stock markets surged on Wednesday, with Japan's Nikkei up 3.0% and South Korea up 3.4%.
- MSCI's Asia-Pacific index outside Japan gained 1.5%, mirroring Wall Street's record highs driven by tech earnings.
- Oil prices retreated as mediators reported progress in efforts to end the U.S.-Iran war.
- Brent crude fell to $79.02 a barrel and U.S. crude to $75.35.
- Bond yields declined, with 10-year Treasury yields at 4.6187%, easing inflation fears.
- The probability of a September Federal Reserve rate hike decreased to 57%.
Asian stock markets surged on Wednesday, mirroring a strong performance on Wall Street, as robust earnings reports and a renewed appetite for technology stocks propelled major indices to record highs. Japan's Nikkei climbed 3.0% and South Korea added 3.4%, while MSCI's broadest index of Asia-Pacific shares outside Japan rose 1.5%.
Despite beating forecasts, chipmaker AMD saw its shares sink 9% after hours, and AI and satellite group SpaceX shed 7.5% due to concerns over capital expenditure consuming cash flow. These concerns are a recurring theme for AI stocks amid rising borrowing costs.
Futures for the Nasdaq dipped 0.1%, while S&P 500 futures gained 0.2%. European futures also showed gains, with EUROSTOXX 50 futures up 0.3%, DAX futures up 0.5%, and FTSE futures up 0.1%.
The market sentiment was further bolstered by a decline in oil prices, attributed to progress in mediation efforts to end the U.S.-Iran conflict. Brent crude eased 0.4% to $79.02 a barrel, and U.S. crude dropped 0.5% to $75.35.
The pullback in oil prices provided some relief from inflation fears, leading to a global boost in bond prices. 10-year Treasury yields fell to 4.6187%, down from last week's high. Consequently, markets sharply reduced the probability of a September Federal Reserve rate hike to 57% from 67%.
Currencies remained largely stable, with the New Zealand dollar slipping 0.2% after its unemployment rate hit a decade high. The euro was flat at $1.1532, and the dollar saw a slight decrease against the yen at 157.53.
Gold prices edged up 0.1% to $4,080 an ounce, supported by the drop in yields.