Tensions Drive Asian Stocks Higher Amid Oil Price Surge

Asian stocks are set to rise on Monday as investors remain cautious about US-Iran tensions. Equity-index futures for Japan and South Korea point to gains at the open, while those for Australia are steady. However, US stock index futures were little changed after Friday's trade.

Oil prices edged higher due to concerns that escalating tensions may disrupt crude supplies. Brent crude rose 0.5% following Iran's statement that it targeted three oil tankers using an unauthorized route through the Strait of Hormuz. The attack also included several US-linked vessels in retaliation for American attacks on Iranian tankers.

Despite the heightened tensions, analysts believe that a hot inflation reading this week could seal a Federal Reserve rate hike this month. Elias Haddad, global head of markets strategy at Brown Brothers Harriman, noted that 'A September 16 Fed funds rate hike hinges on Friday's US August CPI print.'

Meanwhile, in Asia, the yen remains volatile as investors anticipate potential Bank of Japan rate hikes and a possible reallocation by the Government Pension Investment Fund. China's Ministry of Finance will inject $44.7 billion into its largest banks and insurers to ease margin pressure.