Asian stock markets are poised for gains as strong earnings reports and renewed demand for tech stocks propelled Wall Street to record highs. Hopes for progress in opening the Strait of Hormuz are also contributing to a decline in oil prices and bond yields. Japan's Nikkei climbed 3.0%, and South Korea saw a 3.4% increase. MSCI's broadest index of Asia-Pacific shares outside Japan rose 1.5%. However, not all tech firms benefited equally, with SpaceX shedding 7.5% due to a significant amount of stock becoming available for trading.
Oil prices eased, providing some relief from inflation concerns. Brent crude fell 0.4% to $79.02 a barrel, significantly down from its July peak of $102. US crude dropped 0.5% to $75.35. The pullback in oil also boosted bonds globally, with 10-year Treasury yields now at 4.6187%, down from last week's high of 4.747%. Markets also reduced the probability of a September rate hike from the Federal Reserve to 57% from 67%.
Despite the morning's market exuberance, a pullback emerged later in the day as investors awaited further developments on the Middle East situation. The S&P 500 fell 0.2% to close at 7,723.55, pausing after a four-day, $3.7 trillion rally. A key gauge of chipmakers fell 1.4%, though Nvidia Corp. climbed. The Nasdaq fell 0.8% to 26,363.44, weighed down by big technology companies like Alphabet (down 4%) and Microsoft (down 1.1%).
