Asian Markets Retreat as Oil Prices Surge After US Strike on Iran

Asian markets retreated on Monday, following a speech by US Federal Reserve Chairman Kevin Warsh that reinforced expectations of an interest rate hike. The S&P 500 and Dow Jones Industrial Average futures slipped 0.3%. In Tokyo, the Nikkei 225 lost 0.4% to 66,164.66.

The surge in oil prices was a notable exception, with Brent crude up 2.9% at $90.61 per barrel and US benchmark crude jumping 2.7% to $85.66 per barrel. Stephen Innes of SPI Asset Management attributed the increase to the reminder that 'quiet' in the Strait of Hormuz is not the same as peace.

The Fed's focus on inflation control was reinforced by Warsh, who emphasized the importance of short-term interest rates in achieving this goal. The 10-year Treasury yield climbed to 4.72% from 4.67%, and the 30-year Treasury yield got to 5.21% from 5.19%. In other dealings, the US dollar fell to 159.85 Japanese yen from 160.10 yen.