New Delhi, Sep 3: Global financial markets found some relief on Thursday as oil prices eased and government bond yields moved lower, helping investors recover from the sharp volatility seen across markets earlier this week.
Brent crude traded around $95-$96 a barrel, with prices coming under some pressure after US President Donald Trump indicated that the latest escalation in the Middle East may not continue for long. However, oil remained elevated as investors continued to monitor the risk of supply disruptions.
The softer move in crude also helped calm bond markets. US and European government bond yields declined, while Japanese government bond yields pulled back from recent highs. Lower yields eased some concerns about rising borrowing costs and gave equity markets additional support.
US stock futures moved modestly higher, pointing to a more stable opening on Wall Street. Technology shares remained in focus as investors continued to assess strong demand for artificial intelligence-related products and services.
The Japanese yen was another major market mover. The currency extended its recent gains against the US dollar after comments from Bank of Japan officials strengthened expectations that the central bank could consider further interest-rate increases. The sharp rise has also revived speculation about possible intervention by Japanese authorities.
Asian shares also received support from the improved tone in global markets. Investors are closely watching developments in the Middle East, oil prices and government bond yields, as these factors could influence inflation and central-bank policy in the months ahead.
The immediate focus is now shifting to the US August jobs report due on Friday, along with upcoming comments from Federal Reserve officials. Fresh labour-market data could play an important role in shaping expectations for the Fed’s next interest-rate decision.
For investors, the combination of softer oil prices, easing bond yields and stronger currencies such as the yen has provided some breathing room. However, markets are likely to remain sensitive to geopolitical developments and incoming economic data as traders assess the outlook for global growth and interest rates.