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Asian stocks fall as oil rebounds

Renewed military tension between the US and Iran unsettled sentiment on Thursday, sending Asian equity markets lower and pushing oil prices sharply higher again as investors worried about the security of shipping through the Strait of Hormuz. The latest escalation followed a more resilient session on Wednesday in which Wall Street finished mixed, with the Dow closing at another record high and European equities ending modestly firmer. The shift in mood came after earlier hopes for diplomatic progress had briefly improved risk appetite before being challenged by conflicting signals from Washington and Tehran. On Thursday, investors’ attention turns to the US personal consumption expenditures price index, the Federal Reserve’s preferred inflation measure, after other inflation reports earlier this month showed stronger price pressures.

  • Date
  • Auteur Shane Strowmatt, Senior Investment Writer
  • Temps de lecture 5 minutes

Navigator_Asian_Stock_Market_Sentiment

Asia-Pacific markets declined on Thursday after fresh US strikes in Iran heightened Middle East tensions and raised fears of disruption to shipping through the Strait of Hormuz. South Korea’s Kospi led losses, falling 2.7%, while Hong Kong’s Hang Seng dropped 2.4%, Australia’s S&P/ASX 200 lost 1.5%, Japan’s Nikkei 225 fell 1.2% and India’s Nifty 50 was little changed. After falling sharply the previous day, oil prices jumped on Thursday, with Brent crude futures trading around USD 96 per barrel and West Texas Intermediate (WTI) at USD 92, after Kuwait said on Thursday it had activated air defences in response to missile and drone threats. The US Dollar Index strengthened, while gold prices fell, trading around USD 4370 per ounce, pressured by firmer Treasury yields and dropping below the roughly USD 4400 to USD 4600 range seen since mid-May. Bitcoin also fell to around USD 73,000.

Dow hits record as oil briefly falls

US stocks ended mixed on Wednesday, with the Dow Jones Industrial Average rising 0.4% to a record 50,644.28 points and the S&P 500 edging up to 7520.36 points, while the Nasdaq 100 slipped 0.1% to 29,973.57 points after earlier touching a fresh high. Sentiment was briefly supported on Wednesday by lower oil prices and falling bond yields amid hopes that the US and Iran were moving closer to an agreement that could fully reopen the Strait of Hormuz, although the White House later denied reports of a draft deal. Salesforce, the US customer management software company, said on Wednesday that it expects fiscal second-quarter revenue of about USD 11.3 billion, slightly below market expectations, even as first-quarter revenue rose 13% to USD 11.1 billion. Shares fell about 2% in extended trading after the update, adding to a decline of roughly 33% this year, as investors remained concerned about whether its AI products can support broader growth.

European stocks rise

European shares ended higher on Wednesday, with the EuroStoxx 50 rising 0.1%, France’s CAC 40 gaining 0.4% and Germany's DAX little changed. Switzerland’s SMI outperformed, gaining 0.8% and extending the Swiss benchmark’s winning streak to 11 straight sessions. Sentiment was supported by hopes for progress in US-Iran talks and by AI-related optimism. Carmakers rose after EU new passenger car registrations increased 5.1% year-on-year in April to 972,314 vehicles, while Akzo Nobel surged after rejecting a takeover approach that it said undervalued the Dutch paints and coatings maker. In Switzerland, Richemont, Amrize, Sika and Nestlé were among the strongest gainers, while ABB, UBS and Logitech came under pressure.

Corporate and economic calendar

Corporate news in focus: There is no major corporate news scheduled today.

Economic data in focus: European Central Bank President Christine Lagarde speaks (09:20), Swiss National Bank Chairman Martin Schlegel speaks (13:00), European Central Bank monetary policy meeting minutes (13:30), US building permits (14:10), US personal consumption expenditures (14:30), US gross domestic product (14:30), US durable goods orders (14:30), US weekly initial jobless claims (14:30), US new residential sales (16:00).

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Editor: Alessandro Fezzi
Source: LGT Bank (Switzerland) Ltd.