Oil Surge, Fed Rate Hike Pressure Global Markets Amid Inflation Concerns

The global stock market is experiencing a downturn as oil prices surge past $100 per barrel, fueled by tensions in the Middle East and concerns over inflation. The US Federal Reserve's expected interest rate hike this week has investors on edge, with most Asian markets retreating except for Tokyo, Seoul, and Manila.

Crude oil prices have been rising due to the crisis in Yemen, where Houthi rebels seized control of a crucial shipping outlet, and drone attacks on Saudi Arabia's East-West pipeline. The 10-year US Treasury yield has reached nearly five percent, with traders pricing a more than 90 percent chance of a Fed rate hike.

The surge in energy costs has put pressure on central banks to combat inflation, with the US diesel price topping $6 per gallon last Friday. Tech firms saw some recovery from Monday's losses, but analysts warn that the AI boom may be slowing down due to concerns over growth and returns.