Global markets moved unevenly on Tuesday, with equities showing volatility and bonds stabilising after a sharp sell-off, as oil prices declined following comments from US President Donald Trump on Iran.
Trump said he had postponed a planned strike on Iran to allow time for negotiations on a potential nuclear agreement, raising expectations of a possible diplomatic breakthrough.
He added that there is a “very good chance” the United States could reach a deal with Tehran aimed at preventing the development of nuclear weapons.
Oil prices drop amid easing tensions
Oil prices moved lower following the remarks, with Brent crude futures falling nearly 2% to $109.94 per barrel. US West Texas Intermediate crude dropped 1.54% to $106.99 per barrel.
Despite the decline, both benchmarks remain more than 50% higher compared with pre-war levels, reflecting continued geopolitical risk in energy markets.
Asian and US markets under pressure
Equity markets across Asia traded lower, with the MSCI Asia-Pacific index excluding Japan down more than 1%.
Japan’s Nikkei slipped 0.3%, South Korea’s Kospi dropped over 3%, and China’s CSI300 fell 0.8%.
US stock futures also turned negative, with Nasdaq futures down 0.5% and S&P 500 futures declining 0.3%, reflecting cautious investor sentiment ahead of key earnings releases.
Investors are closely watching upcoming earnings from Nvidia, expected on Wednesday, amid high expectations for the world’s most valuable company and its role in the artificial intelligence sector.
Bond markets stabilise after sell-off
Bond markets recovered partially after earlier losses, helped by falling oil prices which eased concerns about inflation pressures.
US 10-year Treasury yields fell from a one-year high to 4.6034%, while two-year yields eased to 4.0674%.
Japanese government bond yields also moved lower across the curve after reaching historic highs in the previous session.
G7 finance ministers also acknowledged rising concerns over public debt and bond market volatility during meetings in Paris.
Currency and gold movements
The US dollar strengthened as investors sought safe-haven assets amid geopolitical tensions, rising 0.1% against the yen to 158.99.
The euro slipped 0.17% to $1.1636, while sterling fell 0.2% to $1.3408.
Gold prices also declined 0.5% to $4,543.26 per ounce, pressured by rising bond yields.
Inflation and interest rate expectations
Markets are increasingly pricing in further interest rate hikes from major central banks this year, as policymakers may need to tighten monetary policy to counter renewed inflation risks driven by high energy prices.
Also read: President calls EU response to Turkish “Blue Homeland” doctrine
For more videos and updates, check out our YouTube channel
