Asian Stocks Gain Before US CPI Data, Oil Climbs: Markets Wrap

(Bloomberg) — Asian stocks rose ahead of key US inflation data as expectations grew that the Federal Reserve may not need to raise interest rates aggressively next year. Crude oil advanced.

MSCI Inc.’s Asia Pacific equities index rose 0.6%, rebounding from two days of losses that pushed the gauge to its lowest close since August on Tuesday. Sentiment improved after New York Fed President John Williams said he saw no need for further tightening in 2027, while continuing to view one more rate hike as appropriate this year.

Swaps are pricing in less than a 25% chance of a rate increase in October.

Elsewhere, global crude oil benchmark Brent rose 0.8% to $106.55 a barrel as a flare-up in Middle East attacks increased uncertainty over a recovery in energy shipments from the Persian Gulf. US crude advanced for a fifth day.

While Williams’ comments offered some relief ahead of the CPI numbers, markets remain concerned that elevated oil prices due to geopolitical conflicts may keep price pressures persistent. Traders are also looking to US corporate earnings for clues on the direction of the artificial intelligence trade, which has come under pressure amid doubts that billions of dollars in spending will deliver commensurate returns.

“Today’s CPI numbers will be particularly important given the recent sharp swings in expectations for further Federal Reserve rate hikes,” Nick Twidale, chief market analyst at AT Global Markets in Sydney, wrote in a note. “A stronger-than-expected inflation print could quickly reignite expectations of further Fed tightening.”

What Bloomberg’s Strategists Say…

“International investors are pulling out at a record pace from emerging Asian equity markets, excluding China. That boosts the likelihood that the region’s stocks will continue to underperform as they struggle to regain the fierce momentum that took the MSCI AC Asia Pacific Excluding Japan Index to a record in June.”

— Garfield Reynolds, MLIV Asia Team Leader. Click here for the full analysis.

Treasuries broadly held their gains from Tuesday, with the benchmark 10-year yield at 5.21%, as traders looked ahead to Wednesday’s US consumer price inflation data for further clues about the path of interest rates.

The dollar weakened against most of its Group-of-10 peers, while gold steadied around $4,160 an ounce.

Meanwhile, the CSI 300 Index fell 0.2%, pushing Chinese stocks closer to a bear market. Skepticism is growing about the prospect of a heavy dose of support measures to revive the economy and investor confidence.

The benchmark has fallen more than 15% from its June peak, and is at the lowest level since August 2025.

Indian stocks are also in focus after Finance Minister Nirmala Sitharaman said she’s keen to listen to discussions around a transaction tax imposed on trading shares as the country seeks to boost capital inflows.

The Nifty 50 Index extended gains as she spoke Tuesday, closing 1.6% higher in its biggest advance in more than two months.

Attention later will turn to the US inflation data.

The closely-watched consumer price index is seen rising 0.6% after a 0.4% increase a month earlier, based on the median projection in a Bloomberg survey of economists ahead of Wednesday’s Bureau of Labor Statistics release. That would mark the largest advance in five months.

Aa higher reading than the estimate may see traders reinforce Fed rate-hike expectations.

“The bottom line is that higher long rates this year reflect both the higher expected policy path from the Fed and investors asking for more compensation to hold duration,” wrote Allison Boxer at Apollo Global Management.

Some of the main moves in markets:

Stocks

S&P 500 futures rose 0.1% as of 12:01 p.m. Tokyo time Japan’s Topix was little changed Australia’s S&P/ASX 200 fell 0.7% Hong Kong’s Hang Seng rose 0.3% The Shanghai Composite rose 0.2% Euro Stoxx 50 futures rose 0.3% Currencies

The Bloomberg Dollar Spot Index was little changed The euro was little changed at $1.1209 The Japanese yen was little changed at 158.30 per dollar The offshore yuan was little changed at 6.6921 per dollar Cryptocurrencies

Bitcoin rose 0.3% to $83,601.4 Ether was little changed at $2,510.22 Bonds

The yield on 10-year Treasuries was little changed at 5.21% Japan’s 10-year yield advanced one basis point to 3.015% Australia’s 10-year yield advanced three basis points to 5.32% Commodities

West Texas Intermediate crude rose 0.9% to $95 a barrel Spot gold rose 0.1% to $4,166.87 an ounce This story was produced with the assistance of Bloomberg Automation.

–With assistance from Winnie Hsu, Toby Alder, Ruth Carson and Lin Zhu.

©2026 Bloomberg L.P.