South Korea stocks gain as Asian stocks rise after US tech rally, oil drops

ASIAN stocks rose for a sixth straight day after chipmakers drove the Nasdaq 100 to its first record high since June, while falling oil prices provided a further lift as diplomatic efforts to end the war with Iran progressed.

MSCI’s Asia Pacific equity index climbed 0.4 per cent with benchmarks in South Korea and Australia gaining, while Japanese markets remained closed for a holiday.

Among the main moves in markets, the S&P 500 futures were little changed as at 9.02 am Tokyo time. Hang Seng futures rose 0.3 per cent, Australia’s S&P/ASX 200 rose 0.2 per cent and Euro Stoxx 50 futures rose 0.2 per cent.

The regional gains came after the Nasdaq 100 Index rose 0.8 per cent, with a closely watched semiconductor gauge climbing over 2 per cent. Shopify jumped 7.1 per cent after striking a partnership with Meta Platforms for its Muse AI product.

Elsewhere, Brent crude extended its decline on Wednesday (Sep 23) to US$98.45 a barrel as US President Donald Trump said US officials had a “very good” meeting with Iranian envoys as Washington renewed efforts to end the conflict.

Treasuries steadied across the curve, the US dollar edged higher and gold pared its losses in the prior session.

The outlook for stocks may hinge on whether diplomacy can push oil lower, easing inflation concerns and taking pressure off bond yields.

Investors are also looking to this week’s summit between Trump and Chinese President Xi Jinping for signs of progress on trade and other economic disputes.

“Focus will stay on geopolitics, and if there is any confirmation of progress towards a ceasefire between the US and Iran, look for oil and yields to fall further and for stocks to rally,” said Tom Essaye at The Sevens Report.

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US stocks: Nasdaq reaches record high close, AI stocks rally

European stocks gain as markets upbeat on potential US-Iran talks

Oil prices settle lower as crude flows from Middle East improve

Oil prices wavered after Iran proposed reopening the Strait of Hormuz within seven days and Saudi Arabia said it expects to resume operations on its East-West pipeline this week.

The moves came as the Trump administration renewed efforts to end the conflict, with the US president saying the war would end shortly after November’s US midterm elections.

The conflict has pushed petrol prices higher, disrupted global oil flows and led Iran to target US bases in the region, killing 19 US service members.

Iran has so far maintained its grip on the Strait of Hormuz, while Iran-backed Houthi rebels in Yemen have again threatened shipping in the Red Sea.

“The elevated flows through the strait point to a loss of Iranian leverage, which suggests they could be more open to making a deal than previously, but it also increases the probability of escalation in an attempt to reassert control,” said Ryan McKay, senior commodity strategist at TD Securities.

Investors are also parsing US Federal Reserve commentary for clues on the rate path after last week’s quarter-point hike.

Richmond Fed president Tom Barkin warned inflationary shocks could take time to fade, while Boston Fed president Susan Collins backed the increase and St Louis Fed president Alberto Musalem said further hikes may be needed.

“The market is pricing in three hikes from here. I would take the other side of that,” said Christian Hoffmann, head of fixed income at Thornburg Investment Management.

“Four hikes over the course of a year is a pretty dramatic response to the economic backdrop and would have real reverberations through the macro economy.” BLOOMBERG