Asian equities opened on a mixed note Tuesday as investors weighed oil market moves, geopolitical risks, and central bank signals ahead of a key Federal Reserve event later this week.
Oil in Focus After Trump’s Ukraine Talks
Crude oil prices held steady after Monday’s 1% gain, with WTI trading near $63 a barrel. Traders are closely watching developments after US President Donald Trump said he is arranging a meeting between Russian President Vladimir Putin and Ukrainian President Volodymyr Zelenskyy, raising hopes for progress on ending the three-year war.
Oil remains more than 10% lower this year, pressured by worries over US trade policies and concerns of oversupply. Markets remain volatile as peace talks could reshape energy flows across the region.
US Market Cues
On Wall Street, the S&P 500 closed little changed on Monday. Yields on 10-year Treasuries edged up by 2 basis points, while the Bloomberg Dollar Spot Index gained 0.2%.
Shares of Intel Corp. fell the most in over three weeks amid reports that Washington may take a 10% stake, even as SoftBank announced a $2 billion investment in the chipmaker.
Spotlight on Jackson Hole
Attention now shifts to the Federal Reserve’s annual Economic Policy Symposium in Jackson Hole, Wyoming, starting Thursday. Fed Chair Jerome Powell is expected to outline a new policy framework on Friday, with investors looking for signals ahead of the September policy meeting.
Markets widely expect the Fed to begin cutting rates next month. Interest-rate swaps show an 80% chance of a 25 basis point cut in September, with two cuts priced in by year-end.
Analysts say last month’s weak US jobs report and downward payroll revisions have increased pressure on the Fed to act, even as inflation risks linger. “The stars are aligning for a September rate cut,” noted Jason Pride and Michael Reynolds at Glenmede.
Outlook
With oil volatility, geopolitical risks, and Fed policy all in play, Asian markets are likely to remain cautious in the near term. Powell’s Jackson Hole remarks are expected to be the biggest driver of sentiment this week.
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