Macro update
Asian equities ease as investors rotate out of AI stocks: Japan’s Nikkei declined 0.6%, South Korea’s KOSPI fell almost 2%, and MSCI’s broad Asia-Pacific index slipped 0.3% as investors shifted away from AI-related shares towards more defensive and cyclical sectors.
Oil prices edge higher amid renewed Middle East tensions: Brent crude rose 0.8% to around $72.50 a barrel and WTI gained 1.3% to $70.11 after fresh US-Iran military strikes highlighted the fragility of the interim peace agreement and once again disrupted shipping through the Strait of Hormuz.
US and Iran return to negotiations following renewed clashes: Diplomatic talks resumed after both countries exchanged military strikes over the weekend, including Iranian missile and drone attacks on US military facilities in Kuwait and Bahrain, marking the most serious escalation since the interim peace deal was reached.
AI-related chipmakers come under renewed pressure: Memory chip producer Kioxia fell 7.5% and SoftBank Group dropped 5.4% in Tokyo after the Philadelphia Semiconductor Index slid 5.3% on Friday, amid concerns that memory chip prices may have risen too far.
Gold remains on course for a fourth straight monthly decline: Spot gold slipped 0.6% towards $4,060 an ounce as higher oil prices and expectations of further interest rate increases weighed on demand, leaving the metal on track for an over 10% monthly loss and its steepest quarterly decline since 2013.
Dollar stays close to one-year highs as rate expectations build: The dollar index held around 101.25 as markets continued to price in at least one Federal Reserve rate increase this year, while Bank of America strategists forecast three hikes, with the yen remaining near a 40-year low around 161.80 per dollar.
