Asia-Pacific stocks hold the line after Trump pulls out of Iran deal

  • Written by MarketWatch
  • Published in Economics

Asia-Pacific stocks were little changed Wednesday after U.S. equities finished flat as President Donald Trump walked away from the Iran nuclear deal[1].

But oil prices CLM8, +2.32%[2]   continued to power higher; futures rose 2% in Asia trading on Wednesday morning. A U.S. industry group revealed larger-than-expected inventory declines last week for oil and petroleum products.

Nearly all stock indexes were recently within 0.25% of Tuesday closing levels. Around the region, Hong Kong’s Hang Seng Index HSI, +0.41%[3]   was up less than 0.1%, China’s Shanghai Composite SHCOMP, +0.06%[4]   fell 0.2%, while Singapore’s FTSE Straights Times STI, -0.07%[5]  was down 0.2%. In Australia, the ASX 200 XJO, +0.20%[6]  was up 0.1%.

The outlier was Japan, where the Nikkei NIK, -0.40%[7]   slid 0.4% as the yen USDJPY, +0.36%[8]   gained and the drug sector slid. Takeda Pharmaceutical TKPYY, -0.10%[9]   pulled back more than 2% after clinching a $62 billion deal for European peer Shire.

Base pay for Japanese workers rose at the fastest year-over-year pace since 1997; overall cash wages climbed 2.1%, the most since June 2003. That is good news for the Bank of Japan’s yearslong efforts to stoke inflation.

Overall, global investors are likely to remain jittery as they digest the implications of the U.S.’s Iran move and ongoing gains in the dollar, which has pressured some emerging-market asset prices.

Because of the dollar’s strength—“the market will be in for a little bit of pain over the short term,” said Stephen Innes, head of Asia-Pacific trading at Oanda.

U.S. Treasury yields have continued to rise in Asian trading, reaching 2.99% for the benchmark 10-year note ...

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