Asian shares edge up as chip sell-off eases ahead of US CPI

Asian shares edged higher on Wednesday as the recent sell-off in artificial intelligence chipmakers began to ease. Samsung Electronics and SK Hynix in South Korea, as well as Kioxia in Japan, all saw gains of more than 2% and recovered some of the previous session's losses. MSCI's Asia-Pacific index outside Japan increased 0.5% after US stocks ended the prior day with a mild decline.

Despite this, sentiment remained cautious due to elevated oil prices driven by concerns over energy supplies following the Houthi missile and drone attacks on Saudi Arabia. Oil prices rose to US$94.96 a barrel for US crude and US$106.6 for Brent crude. Analysts noted the potential impact of geopolitical tensions and energy market fluctuations on the markets.

Bond yields, particularly for 10-year and 30-year Treasuries, rallied as investors sought safety. US stock futures, the S&P 500 e-minis, were up slightly at 7,858.8, reflecting cautious optimism. Investors were eagerly awaiting US consumer price index data to gauge the Federal Reserve's potential interest-rate decision. Economists predicted headline inflation to rise to 3.6% annually in September due to energy price increases, with a 22% chance of an October Fed rate hike according to the CME FedWatch Tool.