Asian stocks extended their slide into a third day and oil edged up as the war in Iran threatens to unleash a wave of global inflation and traders pare bets for interest-rate cuts by the Federal Reserve.The MSCI Asia Pacific Index tumbled 1.6% with stocks opening lower in Japan, South Korea and Australia.
That came after a late recovery in the US session trimmed some of the losses from a global selloff after President Donald Trump's assurances on securing shipping through the Strait of Hormuz helped steady nerves.
US benchmarks fell around 1%.West Texas Intermediate crude rose as much as 1.2% on Wednesday amid prospects of crude flows through the Strait of Hormuz.
Trump said the US will escort and insure tankers and other vessels through the world's most-critical energy chokepoint, a measure meant to head off a potential crisis.ALSO READ: Stock Market News Today Live Updates: GIFT Nifty Suggests Gap-Down Open; South Korea's Kospi Slumps 7%Gold rose 0.5% to trade close to $5,110 on Wednesday, rebounding after a 4.4% slide in the New York session that came amid a recovery in stocks.
The yield on 10-year Treasuries climbed three basis points to 4.06% on Tuesday, while the dollar rose for a second consecutive day on Tuesday.Photo Credit: Bloomberg News“For now, markets are trading headline to headline,” said Fawad Razaqzada at Forex.com.
“Much will depend on whether tensions stabilize — or whether this proves to be the start of a more prolonged disruption to global supply.”The US-Israeli attack on Iran has destabilized the Middle East and threatens to deliver a new inflationary shock to the US economy by pushing up oil prices.
There's also no clear sense of when or how it will end, raising the prospect of prolonged conflict and unforeseen consequences beyond the White House's control.
The war continued to reverberate across the region, with Israel bombarding Tehran in a fresh wave of strikes.
The Islamic Republic fired missiles at Qatar, Bahrain and Oman, with Doha saying targets weren't limited to military interests.
Qatar and Iraq halted production at major energy sites.“There is significant room for global market corrections to continue, as risk has been built up over the last three years of global growth,” according to Bob Savage, head of markets macro strategy at BNY.
“The problem for offsetting equity....
