Global Market Today: Asian stocks, bonds gain as oil extends decline

Asian stocks gained ground today, mirroring the upward trend on Wall Street as falling oil prices dampened inflation worries. Investors remained on watch for the Bank of Japan's interest rate decision later that day. The recent Fed rate hike offered some comfort to traders who feared policymakers were slow to tackle surging inflation that could threaten the world's largest economy.

Recent developments, including Saudi Arabia's swift move to restore a significant portion of crude shipments from the East-West pipeline, have aided in easing inflation concerns. The drop in oil prices, which had surged by nearly a fifth in September, fell by around five per cent from recent highs, with West Texas Intermediate dipping below US$100 (RM409) for the first time since late February.

Inflation's rise has been largely driven by the conflict between the U.S. and Israel against Iran since the end of February, with oil prices boosting this trend. The recent decline in crude prices provided much-needed relief to stocks, with markets in Seoul, Tokyo, Hong Kong, Shanghai, Sydney, and Taipei all rising, while Singapore, Wellington, and Manila saw minor losses.

As oil prices and the Fed's actions alleviated investors' concerns, the 10-year US Treasury bond yield — an essential gauge of borrowing costs across the world's biggest economy — fell below 5 per cent. In currency markets, the yen weakened against the dollar ahead of the BoJ's announcement, which most analysts expect to be a 25-basis-point rate hike.

However, many believe the decision itself may have limited impact, and the focus will shift to the guidance and future tightening plans provided by the Bank Governor Kazuo Ueda.