Asian shares weaker, oil up as investors weigh Saudi-Houthi escalation

Asian markets experienced a slight decline on Wednesday, even as US stocks reached new highs. The MSCI's Asia-Pacific index, excluding Japan, fell by 0.3%, while US stocks closed higher. In Asia, the MSCI index was down 0.3% after US stocks saw a rise. The S&P 500 hit a new record on Tuesday, while the tech-heavy Nasdaq gained 0.45%, also an all-time high.

The Dow Jones Industrial Average increased by 0.5%. Oil prices rose due to concerns over a storm in the Gulf of Mexico and tensions between Saudi Arabia and Yemen's Houthi rebels. US crude prices increased by 1.05% to $90.38 per barrel, whereas Brent crude climbed by 1.06% to $101.65 per barrel. The surge in oil prices was due to a mix of supply concerns and increased shipments of Middle East crude.

Around 12 million barrels per day of crude oil and 2 million barrels per day of refined products have departed the Middle East in the past week. The positive sentiment among US equity traders was influenced by stabilized global bond yields. French debt, significantly sold, rebounded on Tuesday as Marine Le Pen, a far-right presidential candidate, announced budget cuts and a reduction in the country's deficit.

This shift in investor sentiment had a calming effect on European bond markets, with French, Italian, and Greek bonds outperforming. The Japanese yen weakened by 0.19% against the US dollar, while the Swiss franc gained slightly against the greenback. The Federal Reserve's minutes from its meeting on September 15 and 16 will be released on Wednesday, and traders are closely watching for potential rate changes.