Stocks Pare Gains, Oil Rebounds With Iran in Focus: Markets Wrap
(Bloomberg) — Asian stocks pared early gains and US equity-index futures fell as fragile optimism around a potential de-escalation in Middle East tensions faded. Gold extended its slump and is on track for its longest losing streak on record.
Futures contracts for the S&P 500 Index erased early gains to drop 0.6% after the Wall Street Journal reported that US allies in the Persian Gulf are inching toward joining the fight against Iran. Sentiment further weakened after an Iranian lawmaker ruled out negotiations with the US. Asian shares pared their earlier jump of as much as 1.7% to a gain of 0.8%.
Brent crude jumped 3.5% to almost $103.50 a barrel, after plunging 11% on Monday as President Donald Trump announced a delay in striking Iran’s energy assets. The vital Strait of Hormuz remained effectively shut with only a trickle of vessels making their way through the key waterway.
The Bloomberg Dollar Spot Index advanced 0.3% and yields on the two-year Treasury rose six basis points to 3.91% on expectations that higher crude prices may boost the chances of an interest-rate hike by the Federal Reserve.
The moves indicate markets are tempering the optimism that lifted Wall Street and weakened the dollar on Monday after Trump signaled a delay in strikes. Renewed tensions risk keeping oil prices elevated for longer, potentially stoking inflation and reinforcing expectations that policymakers will delay easing interest rates or even raise borrowing costs.
“The situation is still very fluid,” Suresh Tantia, head CIO of Asia equity strategy at UBS Global Wealth Management, said on Bloomberg TV. “It’s quite possible that a week later we get further escalation because there are asks from both sides and it might be very difficult to reach a final conclusion with a very short period of time. Markets could still remain volatile in the short term.”
What Bloomberg’s Strategists Say…
“Brent opened above $100 a barrel amid signs that conflict in the Middle East is far from over. If there are further signals that send crude prices noticeably higher, then another day of whiplash across assets would be the result.”
— Garfield Reynolds, MLIV Asia Team Leader. Click here for the full analysis.
The moves show how quickly geopolitics can sway global markets, with the Hormuz Strait — a chokepoint for about a fifth of global oil and LNG flows — at the center. Since the conflict began, disruptions to traffic through the narrow waterway have driven sharp price swings and heightened inflation risks, leaving progress in US-Iran talks pivotal to stabilizing energy markets and broader financial conditions.
Trump had told reporters on Monday that he was holding off on striking Iranian energy infrastructure for five days, citing “major points of agreement” with Iran. The abrupt shift caught traders off guard. There had been little sign of diplomatic progress before the US president’s post.
“Markets will likely take a cautious approach from here as there is still uncertainty over whether actual talks are being carried out given Iranian denials” said Khoon Goh, head of Asia research at Australia & New Zealand Banking Group.
Tensions remained in the Middle East. A gas pressure-regulation station and an associated administrative building were targeted in Iran’s central Isfahan province in recent US–Israeli attacks, the semi-official Fars news agency reported.
The key to de-escalation is not rhetoric, but financial conditions, said Noureldeen AlHammoury, chief market strategist at Equiti Group in Dubai.
If oil sustains above $120, US 10-year yields approach 4.75%, and equities see a sharp drawdown, the situation quickly becomes an economic problem rather than a geopolitical one, he said.
Markets remain on “hyper alert on the next development,” said Anna Wu, a cross asset strategist at Van Eck Associates Corp. in Sydney.
“Most investors are still waiting for some sort of talk to be confirmed between Iran and the US for clarity,” she said.
Corporate News:
Apollo Global Management Inc. fell 2.6% in extended trading after curbing redemptions from one of its largest non-traded private credit funds for retail investors. Netgear Inc. shares jumped 13% in extended trading after the Federal Communications Commission ordered a ban on the import of new models of foreign-produced consumer wireless routers after an interagency panel determined they threaten national security. Sony Group Corp. is nearing a binding agreement to sell a majority stake in its home entertainment business to Chinese rival TCL Electronics Holdings Ltd. in a deal that may be valued at about $1 billion. Toyota Motor Corp. outlined plans to invest $1 billion to increase vehicle output at its plants in two states, the latest tranche of a broader spending commitment of as much as $10 billion in the US over the next five years. Grab Holdings Ltd. agreed to buy Delivery Hero SE’s Foodpanda operations in Taiwan for $600 million. Some of the main moves in markets:
Stocks
S&P 500 futures fell 0.6% as of 10:59 a.m. Tokyo time Nikkei 225 futures (OSE) rose 1.2% Japan’s Topix rose 1.4% Australia’s S&P/ASX 200 rose 0.3% Hong Kong’s Hang Seng rose 0.9% The Shanghai Composite rose 0.1% Euro Stoxx 50 futures fell 0.9% Currencies
The Bloomberg Dollar Spot Index rose 0.3% The euro fell 0.2% to $1.1584 The Japanese yen was little changed at 158.59 per dollar The offshore yuan fell 0.2% to 6.8971 per dollar Cryptocurrencies
Bitcoin fell 0.6% to $70,491.74 Ether fell 1.1% to $2,137.11 Bonds
The yield on 10-year Treasuries advanced three basis points to 4.38% Japan’s 10-year yield declined 3.5 basis points to 2.270% Australia’s 10-year yield declined seven basis points to 5.05% Commodities
West Texas Intermediate crude rose 3.8% to $91.52 a barrel Spot gold fell 1.9% to $4,325.29 an ounce This story was produced with the assistance of Bloomberg Automation.
–With assistance from Ruth Carson, Abhishek Vishnoi and Winnie Hsu.
©2026 Bloomberg L.P.
