European shares rise
European stock edged higher on Friday but looked on course for their worst weekly performance since April as high bond yields and fears about aggressive interest rate hikes tempered sentiment ahead of key US inflation data.
The pan-European STOXX 600 rose 0.3 percent to 637.60 points by 0716 GMT.
The index closed at a two-month low on Thursday after the European Central Bank raised interest rates as expected and warned of higher inflation as energy prices soar in the wake of a prolonged Middle East conflict.
Oil prices were trading above $100 for a third day. The ECB’s hawkish stance has prompted calls for further rate hikes, while government bond yields across the globe have surged.
The US 10-year Treasury yield, a benchmark for global borrowing costs, hovered below the closely watched 5 percent level.
Australian stocks head for worst week in six months
Australian shares declined for the fourth straight session on Friday in broad-based weakness led by heavyweight miners, while traders focused on inflationary concerns and future rate hikes brought on by the Middle East war-led energy shock.
The S&P/ASX 200 index slipped 1.1 percent to 8,727 by 0010 GMT.
The benchmark settled 1 percent lower in its weakest trade since early June on Thursday.
The index is on track to shed 3.2 percent this week, its worst move since early March, as markets contend with heightened tensions in the Middle East and their implications for energy supply with crude prices trading above the $100 level.
Japan’s Nikkei slumps
Japan’s Nikkei slumped on Friday amid renewed concerns over US rate hikes and a surge in oil prices that fuelled inflation worries.
The benchmark Nikkei 225 gauge fell 1.93 percent to close at 64,011.34, giving it a 0.4 percent decline on the week.
The gauge earlier sank as much as 3.16 percent.
The broader Topix slipped 0.65 percent to 4,028.30. US equities retreated overnight as higher Treasury yields and August producer-price data heightened expectations for a Federal Reserve rate hike.
Fed Chair Kevin Warsh has signalled a shift away from forward guidance, keeping investors alert to upcoming inflation figures.
South Korea stocks drop on oil
South Korean shares fell on Friday amid a sell-off in US treasuries while the inflation data there reinforced bets on an imminent Federal Reserve interest rate hike.
The won strengthened, while the benchmark bond yield rose.
The benchmark KOSPI was down 189.90 points, or 2.78 percent, at 6,844.02 as of 03:25 GMT.
Chipmaker Samsung Electronics fell 4.46 percent, while peer SK Hynix lost 4.21 percent.
Among other index heavyweights, battery maker LG Energy Solution slid 3.42 percent, while Hyundai Motor and sister automaker Kia Corp were down 2.70 percent and down 1.02 percent, respectively.
Oil prices jumped more than 6 percent on Thursday, with both major benchmarks trading above $100 a barrel, as the biggest spike in attacks on shipping since the Iran war began fed worries among traders about further disruptions to already tight supplies.
The South Korean government is preparing to announce a major energy investment project in the United States worth more than $100 billion aimed at boosting artificial intelligence build-out, the Wall Street Journal reported on Thursday.
Steelmaker POSCO Holdings shed 2.06 percent, while drugmaker Samsung BioLogics fell 1.41 percent. Of the total 912 traded issues, 342 shares advanced, while 508 declined.
Indian stocks may fall
Indian shares were set for a sharp fall at market open on Friday as Brent crude soared to $108 per barrel as a widening Middle East war forced investors to flee risk assets.
Iran-aligned Houthis seized control of Yemen’s port city of Mocha on Thursday and advanced the Red Sea coast to strategic islands, military sources said, hours after President Donald Trump said he expected the Iran war to end after the U.S. midterm elections.
The move threatens shipping through the Red Sea, another major waterway, while Gulf traffic remains restricted through the Strait of Hormuz as tanker attacks have intensified.
Gulf bourses ease
Most Gulf stock markets closed lower on Thursday, as escalating hostilities between the United States and Iran fuelled concerns about potential disruptions across vital regional energy corridors.
The decline followed the fiercest maritime confrontation of the six-month conflict. Iran struck 10 vessels near the Strait of Hormuz after the US sank five Iranian tankers.
The attacks prompted US President Donald Trump to caution Tehran with threats of strikes against Iran’s Pickaxe Mountain.
Saudi Arabia’s benchmark index eased 0.1 percent, weighed down by a 1.1 percent slide in Saudi Arabian Mining Company. Oil major Saudi Aramco, on the other hand, added 0.4 percent.
Emerging asian stocks decline
Emerging Asian stocks declined and currencies were flat on Thursday as the biggest wave of attacks on shipping in the ongoing six-month-old war in the Middle East pushed crude oil prices above USD100 a barrel.
The MSCI EM Asia equities index slipped as much as 1.3 percent, while another gauge tracking ASEAN stocks fell to a one-week low.
Brent crude surpassed the USD100 mark on Wednesday for the first time since late July, threatening to stoke inflation and widen trade deficits in oil import-dependent emerging economies in Asia, pushing equities lower and bond yields higher.
Stocks in Seoul and Taipei closed 0.3 percent and 0.5 percent lower. Mainline stock indexes of other net energy importers such as Thailand and the Philippines also declined 0.2 percent and 0.4 percent, while those in Jakarta and Singapore fell at least 0.4 percent.
Malaysia’s benchmark gauge fell 0.7 percent to a one-week low, while the ringgit appreciated nearly 0.2 percent to 4.06 per dollar after weakening steadily for nearly two weeks.
The Singapore dollar, the Thai baht and the Philippine peso were largely unchanged, while the Indonesian rupiah weakened 0.2 percent to 17,535 against the dollar.