Asian markets today: Asian stocks declined on Wednesday, September 2, as a sharp rise in oil prices pushed global bond yields higher, fuelling concerns that a fresh wave of inflation could prompt central banks to adopt tighter monetary policies.
The MSCI Asia Pacific Index fell 1%. Japan’s Nikkei 225 declined 1.60%, while the Topix slipped 1.44%. South Korea’s Kospi dropped 2.87% at the open, while the small-cap Kosdaq fell 2.51%. Meanwhile, Australia’s benchmark S&P/ASX 200 declined 1.09%. Hang Seng futures remained largely unchanged.
On the other hand, GIFT Nifty traded in negative territory, signalling a weak opening for the Nifty 50 on Dalal Street.
“Indian markets are likely to remain under pressure as surging crude oil prices and rising global bond yields continue to weigh on investor sentiment amid the escalating conflict in the Middle East. While India’s resilient domestic growth outlook provides an underlying cushion, external macroeconomic and geopolitical risks are expected to dominate near-term market direction, keeping the broader outlook cautious,” said Ponmudi R, CEO of Enrich Money.
Why Asian markets are falling today?
Asia-Pacific markets opened lower on Wednesday as investors remained cautious amid elevated oil prices, rising bond yields and renewed tensions in the Middle East.
Crude oil prices continued to climb, with Brent crude approaching $95 a barrel, while US West Texas Intermediate (WTI) advanced 0.8% to $90.91. The rise came as intensifying hostilities between the US and Iran heightened concerns over potential disruptions to oil shipments through the Strait of Hormuz.
The surge in global energy prices pushed bond yields worldwide to their highest levels since 2008, as traders increased their expectations of further interest-rate hikes by the US Federal Reserve. Investors also grew increasingly concerned about a possible resurgence in inflation, driven by elevated government spending and increased corporate borrowing linked to the artificial intelligence buildout.
US President Donald Trump said the American strikes were carried out in response to Iran’s efforts to mine the Strait of Hormuz and an earlier attack on a US military base in Jordan. Iran, meanwhile, said it had launched a missile at a US air base in Jordan following the American strikes.
The escalation ended weeks of relative calm, during which Washington had largely relied on economic pressure instead of military action against Tehran. On Monday, Iran’s President indicated that the country was prepared to reciprocate with Washington on a peace agreement if the US returned to the terms of the now-lapsed June memorandum, which had earlier raised hopes of ending the conflict that began in late February.
Federal Reserve Chair Kevin Warsh’s speech at Jackson Hole last week further strengthened expectations of tighter monetary policy. According to a Bloomberg report, markets are now pricing in around a 70% probability of a rate hike in September.
US markets today
US stock futures were little changed on Tuesday night after rising bond yields and oil prices pushed Wall Street lower for another session. Dow Jones Industrial Average futures edged up 12 points, while S&P 500 and Nasdaq 100 futures also traded marginally higher.
Wall Street ended lower for the third consecutive session, with the Dow Jones Industrial Average falling more than 400 points. Technology stocks remained a key drag on the broader market, sending the Nasdaq Composite down nearly 1%.
The yield on the US 10-year Treasury climbed to its highest level since early 2025 on Tuesday. The rise marked the latest indication of a global bond-market selloff, raising concerns among some investors that the turmoil could begin to resemble the 1997 Asian financial crisis.
(With inputs from agencies)
Disclaimer: This story is for educational purposes only. Please consult with an investment advisor before making any investment decisions.
