Global Market Today: Asia stocks waver as yen surges, Iran warns of retaliation

The yen experienced a surge on Tuesday, while Asian markets faced uncertainty due to conflicting economic data and fresh threats from Iran in the Persian Gulf, leading to higher oil prices and bond yields. Japan's Nikkei 225 index fluctuated, ultimately climbing 0.2%, as the yen reached a peak level since February 18. The MSCI's Asia-Pacific index outside Japan rose by 0.2%, primarily driven by a 1.2% increase in the KOSPI.

The S&P 500 e-mini futures declined by 0.1% after a U.S. holiday on Monday. Despite a quieter start to the week due to U.S. Labor Day, ongoing U.S.-Iran tit-for-tat strikes continued to exert upward pressure on oil prices, negatively impacting risk sentiment, according to Westpac analysts. Oil prices rose for the third consecutive day as trading resumed in Asia, with Brent crude futures increasing by 0.04% to $97.04 per barrel, following a six-week high on Monday after Iran warned of retaliatory actions against any new attacks, including targeting energy infrastructure in the Gulf, such as U.S. interests.

The yield on the U.S. 10-year Treasury bond rose by 0.6 basis points to 4.788%. Traders still estimate a 60% probability of a 25-basis-points hike at the Federal Reserve's next two-day meeting on September 16, similar to the previous week's chance. The U.S. dollar index traded near a two-week low of 98.82. Economic data in Japan was mixed, with the country's economy growing faster than initially estimated in the April-June quarter, boosted by business spending.

However, the growth figure was still below analysts' expectations. Japanese real wages increased by 2.4% in July compared to the previous year, marking the largest rise since May 2021. This strong wage growth suggests the Bank of Japan may need to accelerate its tightening measures, according to Capital Economics analysts. Australian shares dropped 0.6% after a measure of local consumer sentiment fell significantly in September.

Gold gained 0.5% to $4,428.23, while Bitcoin rose slightly to $79,333.01, and Ether increased by 0.2% to $2,498.94.