Asia Stocks Follow Wall Street Lower, Dollar Gains: Markets Wrap

(Bloomberg) — Asian shares followed Wall Street lower after the US and Iran exchanged fire, heightening Middle East tensions and stoking inflation concerns. The dollar strengthened.

MSCI’s Asia Pacific Index for equities fell 0.4% from its record-high close Monday, amid speculation the Iran war will escalate. Treasury futures edged higher. Trading in Asia is relatively thin with Japan, China and South Korea all closed for holidays.

Some relief for markets came with oil easing during the Asian session. Brent, the global crude oil benchmark fell 1.1% to about $113 a barrel, after having jumped 5.8% on Monday. US equity-index futures advanced 0.2%.

Meanwhile, the Aussie erased losses after the Reserve Bank of Australia raised its cash rate target.

Renewed Middle East tensions threaten to inject fresh volatility into markets after a month-long rally that helped global equities erase war-related losses and climb to record highs on strong earnings from megacap technology companies. Investors remain focused on the Strait of Hormuz, a key waterway that has been blocked for months, keeping energy prices elevated and risking higher inflation and slower economic growth.

“Even if the immediate conflict de-escalates, we expect the aftershocks will remain with us for some time,” said Darrell Cronk at Wells Fargo Investment Institute. “The effects — on energy prices, industrial activity, and geopolitical risk premia — are unlikely to fade quickly.”

The dollar strengthened against most of its Group-of-10 peers. Gold rose 0.3% to around $4,540 an ounce, while Bitcoin advanced to around $80,500.

Treasury 10-year futures climbed 2/32, trimming Monday’s drop. There’s no trading in cash Treasuries during Asian hours due to a holiday in Japan.

Treasuries fell across the curve during the US session, pushing 30-year yields to 5%, the highest since July. Traders boosted wagers that the Federal Reserve will have to reverse course and raise interest rates to curb inflation following a surge in oil prices.

What Bloomberg Strategists Say…

“Brent and WTI crude futures are weaker on Tuesday, but it is unlikely to offer a strong signal to macro traders amid modest turnover. The big picture is the rapid drawdown of global stockpiles in oil and products, which haven’t yet been fully priced into bonds and stocks.”

— Mark Cranfield, MLIV. For full analysis, click here.

The US fought off Iran’s attacks as it facilitated the passage of two vessels through the Strait of Hormuz. Meantime, the UAE blamed an Iranian drone strike for a fire at its Fujairah port and issued several missile alerts for the first time since a truce between Washington and Tehran took hold.

The wave of attacks came after a plan announced by President Donald Trump to help vessels through the critical waterway, with Tehran warning it would strike US forces if they came near Hormuz. Iran will be “blown off the face of the Earth” if it targets American ships in the region, Trump told Fox News.

“Asian markets are likely to trade with a cautious bias,” said Ritesh Ganeriwal, head of investment at Syfe Pte in Singapore. “This isn’t a full-blown risk-off move yet, but more of a geopolitical wobble that could show up in pockets of Asia — particularly energy-sensitive sectors and FX,” he said.

Corporate Highlights:

HSBC Holdings Plc missed profit estimates as it set aside money for a UK fraud-related exposure and the impact from the conflict in the Middle East and further afield. Palantir Technologies Inc. raised its revenue outlook for the year and beat analyst forecasts, offering a bullish forecast for a polarizing company at the nexus of debates over data, surveillance and artificial intelligence-enabled warfare. Grab Holdings Ltd. reported first-quarter profit that exceeded analysts’ estimates, helped by resilient demand for ride hailing and delivery in a Southeast Asian market rattled by economic and political challenges. Apple Inc. has held exploratory discussions about using Intel Corp. and Samsung Electronics Co. to produce the main processors for its devices, a move that would offer a secondary option beyond longtime partner Taiwan Semiconductor Manufacturing Co. Amazon.com Inc. unveiled a suite of logistics services that will let businesses buy its existing freight and distribution offerings as a package, sending shares of rival delivery companies such as FedEx Corp. and United Parcel Service Inc. lower. A startup backed by General Catalyst Partners agreed to acquire Global Business Travel Group Inc., the travel platform spun out of American Express Co., in a deal worth about $6.3 billion. Some of the main moves in markets:

Stocks

S&P 500 futures rose 0.2% as of 1:24 p.m. Tokyo time Nikkei 225 futures (OSE) rose 0.4% Australia’s S&P/ASX 200 fell 0.5% Hong Kong’s Hang Seng fell 1.2% Euro Stoxx 50 futures fell 0.2% Currencies

The Bloomberg Dollar Spot Index was little changed The euro was little changed at $1.1686 The Japanese yen was little changed at 157.26 per dollar The offshore yuan was little changed at 6.8321 per dollar Cryptocurrencies

Bitcoin rose 1.1% to $80,849.35 Ether rose 1.4% to $2,381.82 Bonds

Australia’s 10-year yield was little changed at 4.98% Commodities

West Texas Intermediate crude fell 2.1% to $104.16 a barrel Spot gold rose 0.2% to $4,531.83 an ounce This story was produced with the assistance of Bloomberg Automation.

–With assistance from Bernadette Toh.

©2026 Bloomberg L.P.