Oil prices gain, Asian shares are mixed after rally on Wall Street

TOKOYO: Asian shares were mixed on Tuesday following a rally on Wall Street that was helped by easing oil prices.

Regional investors were still weighing the impact from last week's joint US-Japan currency intervention, analysts said.

Japan's benchmark Nikkei 225 slipped 0.3 per cent to 63,585.58, as the US dollar inched up to 157.51 Japanese yen from 157.18 yen. The euro cost USD 1.1511, little changed from USD 1.1514. The dollar was trading at 160-yen levels before regulators stepped in to boost the yen's value after it fell to nearly 40-year lows.

Some analysts said the effectiveness of such an intervention remains uncertain as it doesn't address the fundamental economic reasons behind the currency fluctuations, including inflation, interest rates and the relative strengths of the economies.

“A US-backed operation carries far more signalling weight than Tokyo acting alone, and the pledge of further action will give speculators pause. But any US contribution will probably be constrained by size,” a report by BMI, a unit of Fitch Solutions, said.

Matthew Ryan, head of market strategy at global financial services firm Ebury, noted the latest effort could have some impact because it appears to signal a real change in monetary policy rather than just a one-time defensive move.

“This is an historic and meaningful development for the yen, which materially improves confidence in our mildly bullish call for the currency,” he said.

South Korea's Kospi sank 1.3 per cent to 6,174.72. Australia's S&P/ASX 200 added 1.2 per cent to 9,129.00. Hong Kong's Hang Seng fell 0.5 per cent to 25,881.99, while the Shanghai Composite gained 0.2 per cent to 3,802.61.

Markets remain unsettled by swings for stocks of companies that make computer chips. They've been veering up and down for weeks on worries about whether their surging revenues because of the artificial-intelligence boom are sustainable.

On Wall Street, share prices rallied Monday after easing oil prices helped calm worries over inflation. The S&P 500 jumped 1.5 per cent and is just 0.1 per cent below its record set earlier this summer.

The Dow Jones Industrial Average, which measures a narrower slice of the US stock market, climbed 693 points or 1.3 per cent to an all-time high, while the Nasdaq composite leaped 2.1 per cent.

In energy trading in Asia early Tuesday, benchmark US crude gained 84 cents to USD 81.18 a barrel. Brent crude, the international standard, jumped USD 1.15 to USD 84.92 a barrel.

A day earlier, oil prices dropped more than 5 per cent after US President Donald Trump said over the weekend that he had decided to hold off on new strikes against Iran at the urging of allies in the region.

Brent's price careened between USD 72 and USD 102 last month as worries rose and fell over the war in Iran and when oil tankers would be allowed to freely exit the Persian Gulf again to deliver crude to customers worldwide.

The yield on the 10-year Treasury sank to 4.68 per cent from 4.75 per cent late Friday. It remains well above its 3.97 per cent level from before the war with Iran.