Asia share markets slips as oil prices surge

Asia’s share markets slipped on Monday as fresh drone attacks in the Gulf pushed oil prices higher and rattled bond markets. A strike caused a fire at a UAE nuclear plant, while Saudi Arabia intercepted three drones, escalating tensions as the Strait of Hormuz remains largely closed.

Share Markets

Analysts warned global oil inventories could hit critical levels by June, potentially driving Brent crude to US$130–140 per barrel. Brent rose 1.2% to US$110.63, while US crude climbed 1.0% to US$106.42. Bond yields surged, with U.S. 10‑year notes at 4.584% and 30‑year bonds at 5.109%, as investors feared central banks may tighten policy to curb inflation.

Japan’s Nikkei

Stock markets across Asia reflected the strain. Japan’s Nikkei eased 0.4% after last week’s 2% drop from record highs, while South Korea’s Kospi fell 2.1% as semiconductor demand cooled. MSCI’s Asia‑Pacific index outside Japan lost 0.6%. China’s markets, at four‑year highs, await key retail and industrial data. S&P 500 futures fell 0.4% and Nasdaq futures 0.5%, with Citi analysts warning that recent U.S. earnings gains were narrowly based on one‑time items.

An AI Boom…

The AI boom faces a crucial test this week with Nvidia’s earnings due Wednesday. Expectations are sky‑high for the world’s most valuable company, whose shares have surged 36% since March. The Philadelphia semiconductor index has jumped over 60% amid massive AI infrastructure spending. Analysts caution that broader earnings growth is needed to sustain the rally. Retail giants like Walmart will also report, offering insight into consumer resilience against high energy costs.

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