Asian Markets Mixed, Oil Near 3-Week Lows on Iran
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- South Korean shares jumped as much as 2.1%, lifting MSCI's Asia-Pacific index outside Japan up 0.1%, while Japan's Nikkei 225 slipped 0.3% and S&P 500 e-mini futures nudged 0.1% higher
- Brent crude rose 0.6% to $84.29 a barrel, recovering slightly after falling to a three-week low on Monday when Trump said he had held off on a fresh attack on Iran as a goodwill gesture in peace talks
- Tehran denied that any negotiations with the US are taking place, directly contradicting Trump's claim, leaving the so-called stalemate unresolved
- Overnight, US manufacturing activity rose to its highest level in more than four years in July, sending the Dow Jones Industrial Average to a record close and driving the broader risk-on mood
- The dollar rose 0.3% to 157.625 yen against the yen, rebuilding after coordinated US-Japanese intervention to prop up the yen last week, while the US dollar index sat near two-month lows at 99.99
- Markets are pricing a 65% probability the Federal Reserve delivers a 25-basis-point hike at its September 16 meeting, per CME's FedWatch tool, after NY Fed President John Williams said inflation is on track to ease but the Fed will act if it doesn't
- Bitcoin slipped 0.5% to $63,446.35 and ether fell 0.5% to $1,857.44 as risk appetite remained cautious
Why it matters: With Tehran openly contradicting Trump's claim of peace talks, the three-week low in oil prices reflects trader optimism that may evaporate fast on any fresh escalation, while a 65%-priced September Fed hike means monetary policy remains a live risk for Asian assets regardless of how the Iran standoff resolves.
