Asian Equities Set for Muted Open as Oil Gains: Markets Wrap

Asian markets are poised for a tepid open on Tuesday after a subdued overnight session with Wall Street closed for a holiday.

US equity futures edged higher in early Asia trading, while modest moves in Asia contracts pointed to a gain in Tokyo, loss in Hong Kong and a flat open in Sydney. The dollar was little changed against major currencies.

Oil climbed on Monday ahead of a glut that’s expected to form in the coming months. India mounting US pressure to end crude imports from Russia while Ukraine struck more Russian refineries over the weekend as it ramped up attacks on the country’s infrastructure.

Wall Street’s record-breaking rally now faces a pivotal test, with jobs numbers, inflation data and the Federal Reserve’s rate call all landing within the next three weeks. Tariff tensions and questions over the Fed’s independence were also compounding the risks.

“The bar to derail a Fed rate cut on Sept. 17 appears high,” Deutsche Bank AG economist Peter Sidorov wrote. “But with Fed funds futures now pricing over 140 basis points of easing by the end of 2026, markets are expecting an amount of easing that since the 1980s has only occurred around recessions.”

Traders will be closely monitoring Indonesian markets after stocks the most in nearly five months on Monday. Political risks have recently flared, with President Prabowo Subianto canceling a China trip after deadly unrest over living costs and inequality. Stress also was evident in the bond market, with yields on the nation’s 10-year government note rising to the highest in almost three weeks.

In commodity markets, silver rose above $40 an ounce on Monday for the first time since 2011. Gold inched closer to an all-time high as optimism grew for a Fed rate cut.

In Europe, bonds weakened broadly, with a week to go before a that could topple France’s government. The French-German 10-year spread, a key measure of risk, was little changed at 79 basis points. The gauge closed at 82 on Aug. 27, the highest since January.

Some of the main moves in markets:

Stocks

Currencies

Cryptocurrencies

Commodities

This story was produced with the assistance of Bloomberg Automation.