Asian Markets Edge Higher Despite Oil Shock
Oil prices continued to rise amid concerns over a prolonged conflict in Iran. Meanwhile, the Asian markets that were open on Friday experienced moderate gains in cautious trading, while others remained closed for the Good Friday holidays. Benchmark US crude increased by 11.4 percent, reaching $111.54 a barrel. The price of Brent crude, the international standard, surged 7.8 percent to $109.03 per barrel. “A more extended conflict raises the threat to physical infrastructure, extends disruptions through the Strait of Hormuz, and will entail a longer post-war recovery period, with price impacts spilling over later into the year,” according to a report. The United States depends on the Persian Gulf for only a small portion of its oil imports; however, oil is a commodity, and its prices are determined in a global market.
In Asia, the circumstances are markedly distinct. Japan, for instance, depends on access to the Strait of Hormuz for a significant portion of the nation’s oil import requirements and would have to turn to alternative routes. However, certain analysts suggest that Japan and other countries are relying on a deal with Iran to facilitate transport operations. Additionally, Japan’s benchmark Nikkei 225 experienced a rise of 0.9 percent in Friday morning trading, reaching 52,938.62. South Korea’s Kospi surged 2.1 percent to 5,344.41. The Shanghai Composite declined by 0.5 percent, closing at 3,899.57. Trading was suspended in Hong Kong, Singapore, Australia, New Zealand, the Philippines, Indonesia, and India.
Wall Street, where trading is closed Friday, concluded its first winning week since the onset of the Iran war, despite an initial decline in trading prompted by a spike in oil prices. That came after US President Donald Trump late Wednesday vowed that the US would continue to attack Iran and did not provide a clear timetable for ending the conflict in the Middle East. The S&P 500 increased by 7.37 points, representing a 0.1 per cent gain, reaching a total of 6,582.69. After several days of solid gains this week, the benchmark index achieved a 3.4 percent increase for the week. The Dow Jones Industrial Average experienced a decline of 61.07 points, equating to a 0.1 percent drop, settling at 46,504.67.
The Nasdaq composite increased by 38.23 points, representing a 0.2 percent rise, reaching a total of 21,879.18. Both indexes recorded weekly gains. Treasury yields exhibited a stable trend in the bond market. The yield on the 10-year Treasury decreased to 4.30 percent from 4.32 percent. In currency trading, the US dollar rose to 159.66 Japanese yen from 159.53 yen. The euro was valued at $1.1535, a slight decrease from $1.1537.
