Asia Mixed as Geopolitical Tensions Persist; Oil Up, Gold Up

Lead Asian equities closed mixed today, with some markets seeing gains while others declined, as geopolitical concerns in the Middle East continued to influence sentiment. WTI crude oil rose by 0.77%, and gold futures gained 1.08%. Session narrative Asian markets displayed a mixed performance today, with geopolitical tensions remaining a key driver. Crude oil prices continued their upward trajectory, with WTI crude advancing 0.77% and Brent crude climbing 1.03%. This increase followed reports of coordinated attack plots in Saudi Arabia and Russia hitting Ukrainian military cargo in the Black Sea. Precious metals also saw significant gains, with gold up 1.08% and silver surging 3.46%. In currency markets, the Japanese Yen experienced intervention from Japan, which sold euros to prop up the currency. The US Dollar Index showed a modest gain of 0.017%. Economic data released today included China reporting double-digit growth in both exports and imports, indicating resilience in its trade sector. Conversely, Germany's industrial production fell by 0.1% year-over-year. On the central bank front, Fed's Musalem indicated a preference for raising rates at the recent FOMC meeting, emphasizing the need for meaningful restraint on inflation and closely monitoring highly accommodative financial conditions. This sentiment underscores ongoing concerns about inflation and the Federal Reserve's policy direction. Cross-asset check Equity futures in the US showed mixed movements, with S&P 500 futures up 0.029% and Nasdaq futures up 0.216%, while Dow futures were down 0.120%. The US 10-year yield rose by 1.147%. In FX, the EUR/USD was up 0.017%, while USD/JPY was down 0.090%. Commodities saw strong performance from silver, up 3.46%, and gold, up 1.08%. WTI crude gained 0.77% and Brent crude rose 1.03%. Natural gas also saw an increase of 0.75%. Themes & continuing stories Geopolitical tensions, particularly in the Middle East and the ongoing conflict in Ukraine, remain a dominant theme, directly impacting energy markets and broader sentiment. Central bank policy and inflation concerns continue to be a focal point, with Fed officials signaling a hawkish stance to manage price stability. Japan's intervention in the currency market to support the yen highlights global efforts to manage exchange rate volatility amid economic uncertainties. What’s ahead Market participants will continue to monitor geopolitical developments, particularly those affecting energy supplies. Further statements from central bank officials will be closely watched for clues on future monetary policy. Economic data releases from major economies will also provide insights into global growth trajectories and inflation pressures.