On Friday (25 September, 9:27 AM, GMT+7, Bangkok time), major indices in the Asia-Pacific traded mixed as market participants reacted to ongoing turbulence in global bond markets, while keeping a close eye on diplomatic developments involving the U.S. and China, as well as on geopolitical shifts in the Middle East.
Expectations for easing tensions in the Persian Gulf improved after reports emerged that U.S. and Iranian officials, meeting in New York, are discussing a potential phased arrangement to resolve the region’s standoff. Hopes for this diplomatic breakthrough come after renewed anxieties over oil supply, spurred by a Houthi missile strike in Saudi Arabia, led crude prices to climb approximately 3% to a one-week high on Thursday.
U.S. Treasury yields extended their upward trajectory. The yield on the 10-year note reached 5.225% late Thursday, marking its highest point since 2007, while the 30-year yield advanced to 5.502%.
The current surge in yields is attributed to a combination of hawkish remarks from Federal Reserve Governor Michael Barr, continued upward pressure on energy prices stemming from the conflict in the Middle East, and stronger-than-expected PMI data. The CME FedWatch tool indicates a roughly 68% probability that the Fed will raise rates at its October meeting.
Meanwhile, trading in mainland China and South Korea was halted for a public holiday.
Japan’s NIKKEI increased by 1.16% to 66,276.32. Australia’s ASX 200 dropped by 0.47% to 8,660.80, and Hong Kong’s HSI slumped by 1.71% to 24,336.83.
The U.S. stock markets saw marginal movements on Thursday as the Dow Jones Industrial Average (DJIA) contracted by 0.31% to 51,349.98. NASDAQ climbed by 0.01% to 26,939.37, while S&P 500 slid by 0.02% to 7,704.13. VIX rose by 3.23% to 15.67.
As for commodities, oil prices settled lower on Thursday in response to renewed supply concerns after a Houthi missile struck targets in Saudi Arabia. Volatility was evident throughout the session, with prices retreating from their highest levels following news that the U.S. and Iran had discussed plans to potentially reopen the Strait of Hormuz.
While military activity between the U.S., Israel, and Iran remains largely at a stalemate, U.S. officials have moved to further tighten financial restrictions, extending sanctions to non-U.S. firms conducting business with Iranian companies through secondary sanctions. Brent crude concluded trading with a gain of $3.52, closing at $106.60 per barrel, reflecting a 3.4% increase. U.S. West Texas Intermediate crude settled $2.45 higher at $94.61, up 2.7%.
This morning, Brent futures decreased 90 cents, or 0.84%, to $105.70 per barrel, and WTI futures plummeted $1.54, or 1.63%, to $93.07 per barrel.
Meanwhile, gold futures surged 0.62% to $4,324.60 per Troy ounce.
