Asian shares mixed as oil relief cools inflation worries, yen intervention eyed

Tokyo,UPDATED: Aug 4, 2026 10:46 IST

Asian shares were mixed on Tuesday after a rally on Wall Street, where easing oil prices helped calm inflation worries. Investors in the region were also assessing the impact of last week’s joint US-Japan currency intervention.

Analysts said the move to support the yen has shifted market attention to whether it can have a lasting effect, even as broader factors such as inflation, interest rates and the relative strength of economies continue to drive currency movements.

Japan’s benchmark Nikkei 225 slipped 0.3 per cent to 63,585.58, as the US dollar edged up to 157.51 Japanese yen from 157.18 yen. The euro was at USD 1.1511, little changed from USD 1.1514. The dollar had been trading at 160-yen levels before regulators stepped in to lift the Japanese currency after it fell to nearly 40-year lows.

Some analysts said the effectiveness of such intervention remains uncertain because it does not address the underlying economic reasons behind currency swings. “A US-backed operation carries far more signalling weight than Tokyo acting alone, and the pledge of further action will give speculators pause. But any US contribution will probably be constrained by size,” a report by BMI, a unit of Fitch Solutions, said.

Matthew Ryan, head of market strategy at global financial services firm Ebury, said the latest effort could have some effect because it appeared to signal a real change in monetary policy rather than a one-time defensive move. “This is an historic and meaningful development for the yen, which materially improves confidence in our mildly bullish call for the currency,” he said.

Elsewhere in Asia, South Korea’s Kospi fell 1.3 per cent to 6,174.72. Australia’s S&P/ASX 200 rose 1.2 per cent to 9,129.00. Hong Kong’s Hang Seng dropped 0.5 per cent to 25,881.99, while the Shanghai Composite added 0.2 per cent to 3,802.61.

Markets have remained uneasy over sharp swings in the shares of computer chip companies. Their stocks have moved up and down for weeks amid concerns over whether revenue growth linked to the artificial intelligence boom can be sustained.

On Wall Street, shares rose on Monday after lower oil prices eased inflation concerns. The S&P 500 climbed 1.5 per cent and was just 0.1 per cent below its record set earlier this summer. The Dow Jones Industrial Average rose 693 points, or 1.3 per cent, to a record high, while the Nasdaq composite jumped 2.1 per cent.

In energy trading in Asia early Tuesday, benchmark US crude rose 84 cents to USD 81.18 a barrel. Brent crude, the international standard, gained USD 1.15 to USD 84.92 a barrel. A day earlier, oil prices had dropped more than 5 per cent after US President Donald Trump said over the weekend that he had decided to hold off on new strikes against Iran at the urging of allies in the region.

Brent crude had swung between USD 72 and USD 102 last month as concerns rose and fell over the war in Iran and over when oil tankers would again be able to leave the Persian Gulf freely to deliver crude worldwide. The yield on the 10-year Treasury fell to 4.68 per cent from 4.75 per cent late Friday, though it remained well above its 3.97 per cent level from before the war with Iran. Overall, markets on Tuesday reflected a mix of caution over currencies and chips, and some relief from the recent easing in oil prices.

With PTI Inputs

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