Oil Drops as Trump Calms Iran fears
Oil prices pulled back from multi-month highs recently; while safe-haven gold slipped from a record high after US President Donald Trump soothed market concerns over possible military action against Iran.
A selloff in tech stocks extended into Asian trading, after further declines on Wall Street as investors rotated out of high-flying chip- and artificial intelligence-related names, looking for bargains in other parts of the market.
Currencies paused for breath after the yen dropped to its weakest since July 2024 against the US dollar overnight and then bounced back sharply amid warnings of possible intervention by Japanese authorities.
Japanese bond yields eased back from record peaks following a spike driven by speculation - which was later confirmed- that the government will call snap elections, a scenario expected to lead to bigger fiscal stimulus.
Brent crude futures dropped 2.4 percent to $64.94, and Nymex futures also sank 2.4 percent to $60.51, from as high as $66.82 and $62.36, respectively, in the previous session.
Gold fell 0.5 percent to around $4,598 per ounce. It reached an unprecedented $4,642.72. Stocks in Asia were mixed, but tech shares encountered more selling.
The Bank of Korea left interest rates unchanged on Thursday, as economists had predicted, and signaled an end to its current easing cycle. S&P 500 E-mini futures were off 0.1 percent, after the cash index sank 0.5 percent overnight. The tech-focused Nasdaq Composite dropped one percent.
The US dollar was steady against its major peers on Thursday, with the dollar index flat at 99.107.
It eased slightly to 158.32 yen after surging as high as 159.45 yen on Wednesday before pulling back sharply.
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Japanese Finance Minister Satsuki Katayama issued another verbal warning, saying officials would take "appropriate action against excessive FX moves without excluding any options."
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Prime Minister Sanae Takaichi plans to dissolve parliament's lower house next week and call a snap parliamentary election as early as February 8.
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Expectations of a bigger fiscal stimulus on an improved mandate have spurred investors to sell the yen and government bonds, sending longer-dated yields to record highs in recent days.