Crude oil slumps 6% to $82 on hopes of Iran deal
S&P 500 futures rose 0.4% while Nasdaq futures gained 0.6%. But Japan’s Nikkei dipped 1% and South Korea’s KOSPI slid 3.6% after a turbulent July in which it slumped 22%.
Oil prices experienced a significant drop, with Brent crude futures falling more than 6% to $82.41 following President Donald Trump's announcement of talks with Iran. The talks aimed to reopen the Strait of Hormuz and address concerns over Tehran's nuclear capabilities. The U.S. President had initially called off an imminent attack on Iran to facilitate a deal.
Meanwhile, stocks fluctuated, with the S&P 500 rising 0.4% and the Nasdaq gaining 0.6%. However, Japanese and South Korean stock markets suffered losses, with Nikkei down 1% and KOSPI falling 3.6%. The MSCI Asia-Pacific index outside Japan also declined by 1% in early trading. The Japanese yen surged more than 1% against the U.S. dollar, prompting traders to anticipate further intervention by Japan and the U.S. Japan's finance ministry confirmed a bilateral action to stop the yen's slide, which had reached fresh 40-year lows.
Analysts noted that while the yen's depreciation trend may not have fundamentally altered, the recent U.S.-Japan communication signaled a warning to speculative traders. Trump's comments during the announcement were seen as a "friendship trade," casting doubt on the U.S. intervention's credibility and potentially leading to a market correction once the intervention concludes.
Written by urgent.news from Hindu BusinessLine's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
