Global equities rise as US sanctions on Iran weigh on oil prices
European and Asian stock markets mostly posted gains on Tuesday, while US markets ended mixed after new sanctions on Iran and a dip in oil prices.
Shares in Europe and Asia mostly rose on Tuesday after US equities finished mixed, amid expectations of market-moving events later in the week. The move came as oil prices fell following Treasury Secretary Scott Bessent's announcement of fresh sanctions on Iran and a warning that firms continuing business with the country could face retaliation.
Germany's DAX gained 0.5%, France's CAC 40 added 0.3%, and Britain's FTSE 100 edged up 0.1%. In the United States, futures for the S&P 500 were up 0.3% and the Dow Jones Industrial Average rose 0.2%.
In Asia, Tokyo's Nikkei 225 climbed 0.5%, boosted by a 2.3% rise in SoftBank Group shares. South Korea's Kospi reversed early losses to gain 0.7%, while Hong Kong's Hang Seng was largely unchanged and Shanghai's Composite index rose 0.2%. The Australian S&P/ASX 200 advanced 0.7%, Taiwan's Taiex jumped 0.9%, and India's Sensex slipped 0.2%.
US bond markets showed modest easing, with the 10-year Treasury yield falling to 4.69% from 4.74% on Friday, after the Treasury Department announced a larger-than-expected buyback program. "The latest discussion about using Treasury General Account cash to help finance purchases of longer-dated bonds gave the market something to chew on Monday, and it initially liked the taste. Long yields fell, and the curve flattened," said Stephen Innes of SPI Asset Management. He added that a short-term market reaction does not solve underlying fiscal challenges.
Technology stocks led recent declines, with Nvidia down 2.9%, Micron Technology down 5.8% and Broadcom down 2.6%, as investors weigh the sustainability of AI-driven price gains. Nvidia is scheduled to report earnings on Wednesday, which could influence AI-related equities.
Oil prices dropped early Tuesday, with Brent crude falling 2% to $88.74 per barrel and US crude slipping 2.2% to $83.14. The sanctions on Iran have also pushed the Iranian rial to a record low against the dollar. The US dollar strengthened to 159.30 yen, while the euro rose slightly to $1.1670.