Asia shares weaker, oil up as investors weigh Saudi-Houthi escalation
SPY•Asian shares fell, while oil prices rose as investors weighed a Gulf of Mexico storm threat and escalating Saudi-Houthi tensions. The Asia-Pacific index excluding Japan was down 0.5%, while Brent crude rose 1% to $101.58 a barrel.
1. Asian shares slip
The MSCI Asia-Pacific index excluding Japan fell 0.5% on Wednesday, led by declines in Hong Kong and Singapore, despite record closes for the S&P 500 and Nasdaq. Japan's Nikkei was down 0.8%, Australia's market fell 0.1%, and Indian stocks slipped 0.5%.
2. Oil prices rise
US crude rose 0.9% to $90.22 a barrel, while Brent gained 1% to $101.58. Investors weighed potential supply constraints from a storm heading toward North American oil-producing regions and Houthi attacks on Saudi Arabia against increased Middle East crude supplies. Vitol CEO Russell Hardy said about 12 million barrels per day of crude and 2 million barrels per day of refined products had left the Middle East on tankers in the prior seven to 10 days.
3. Rates and currencies
The US 10-year Treasury yield rose 3.8 basis points to 5.307% ahead of auctions of 10-year and 30-year debt. India's central bank raised its benchmark rate by 25 basis points to 5.5%, its first increase in nearly four years. Traders scaled back expectations of a US Federal Reserve rate increase this month to 19% from about 50% a week earlier.
