World stocks inch up as oil drops on Hormuz hopes
Weaker oil prices push bond yields lower on hopes the Strait of Hormuz could reopen, as investors await US inflation data and Nvidia's earnings.
Global stocks rose slightly on Wednesday as oil prices fell due to optimism over the potential reopening of the Strait of Hormuz. European benchmark STOXX 600 remained at its highest level in over a week. Investors were also awaiting the release of US inflation data and Nvidia's earnings report. Iran and Oman had discussed a joint temporary navigational corridor through the Strait and agreed to clear it of mines, reigniting hopes for an end to the six-month conflict affecting oil markets and global inflation.
Brent crude prices dropped nearly 3% to USD 85.95 per barrel on the prospect of increased supply through the Strait. This helped push short-term bond yields lower, with the yield on 2-year German bonds hitting a one-week low of 2.771%. Oil prices have moved away from a previous 90+ move, suggesting there is optimism they could drop further.
However, analysts noted the need to witness the actual movement of traffic through the Strait of Hormuz to be more confident that inflationary pressures are cooling.
Written by urgent.news from Free Malaysia Today's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
