Market Update: Asian Shares Hold Steady, Oil Prices Bounce Back

Asian Markets Stay Calm Amid Easing Global Tensions

Asian shares remained mostly steady on Thursday. Oil prices found some footing. Markets are responding to calming geopolitical tensions. They are also awaiting new clues on US fiscal and trade policies. President Donald Trump’s upcoming tariff deadline is a key focus.

Key Points:

• Investors are being careful due to uncertainties about Federal Reserve leadership.
• Changes in US interest rate policy are also a concern.

Market Trends

The MSCI’s broad index of Asia-Pacific shares outside Japan stayed steady. Tokyo’s Nikkei rose by 0.9%, hitting a four-month high. Hong Kong’s Hang Seng increased by 1.2%. The Shanghai Composite also went up by 1%. A recent ceasefire between Israel and Iran has eased global supply worries.

Oil Prices Rise

Oil markets saw slight gains. Brent crude increased by 0.2% to $67.82 per barrel. US West Texas Intermediate (WTI) rose by 0.28% to $65.10. These prices are recovering from earlier losses this week.

US Fuel Demand and Geopolitical Risks Ease

Both oil benchmarks had climbed nearly 1% the day before. Strong US fuel demand and easing geopolitical risks drove this increase. US government data showed a drop in crude inventories by 5.8 million barrels last week. Gasoline demand hit its highest level since December 2021.

Market Confidence Improves

Market confidence got better due to a fragile ceasefire between Iran and Israel. US President Trump announced this ceasefire. It has helped oil prices return to near pre-conflict levels. However, concerns over Middle East supply have not fully disappeared. Stronger demand for immediate supply continues to support prices.

Federal Reserve Leadership in Question

Talk about Federal Reserve Chair Jerome Powell’s future added to market ups and downs. President Trump is thinking about replacing him by September or October. This talk has weighed on the US dollar. The euro rose to $1.6805, its highest since November 2021. The Swiss franc hit a 10-year high. The dollar index slumped to its lowest since March 2022.

Central Bank Signals and Upcoming Tariff Deadlines

Equity markets worldwide are sensitive to signals from central banks. President Trump’s July 9 deadline for finalizing new trade tariffs is approaching. Federal Reserve Chair Jerome Powell has warned about potential tariffs causing a “one-time jump in prices.” He also cautioned about the risks of more persistent inflation.

Global Fiscal Watchfulness

Bank of America strategists highlighted the need for global fiscal watchfulness. They noted that “unsustainable fiscal dynamics can trigger an accident in bond markets.”

Oil Prices Expected to Stabilize

Analysts expect oil to stabilize between $65-70 per barrel. Traders are tracking US macroeconomic data and the Fed’s next rate move. The global market mood appears to be steadying. Investors remain watchful for how tariffs, inflation, and central bank responses will shape economic paths in the months ahead.