BANGKOK — European shares mostly fell and Asian shares advanced on Thursday, while the intensifying war with Iran pushed Brent crude to over US$98 a barrel.
The futures for the S&P 500 and the Dow Jones Industrial Average slipped 0.4 per cent.
Germany’s DAX lost 0.6 per cent to 24,999.26 in early trading and the CAC 40 in Paris shed 1.1 per cent to 8,349.33. Britain’s FTSE 100 edged 0.2 per cent lower, to 10,696.31.
Asian shares mostly rose, led by South Korea’s Kospi, which gained 4.4 per cent to 7,096.89.
Investors’ appetite for stocks related to artificial intelligence revived despite a retreat on Wall Street, as Samsung Electronics gained 3.7 per cent. Memory chipmaker SK Hynix advanced 4.9 per cent.
In Tokyo, the Nikkei 225 picked up 0.5 per cent to 66,422.60. Technology companies led gains, with stocks in SoftBank Group climbing 3.8 per cent.
The U.S. dollar was trading at 163.36 yen as the Japanese currency wavered near its lowest level in 40 years. Expectations that the gap between U.S. interest rates and Japanese interest rates will widen due to higher inflation in the U.S. have helped to drive the dollar higher against the yen.
Elsewhere in Asia, Hong Kong’s Hang Seng rose 1.3 per cent to 25,210.81. The Shanghai Composite index bounced back from earlier losses to gain 0.3 per cent, closing at 3,876.78.
In Australia, the S&P/ASX 200 gained 0.2 per cent to 8,839.00.
Taiwan’s Taiex edged 0.1 per cent higher and the Sensex in India fell 0.6 per cent.
On Wednesday, U.S. stock indexes barely budged as oil prices rose 3 per cent.
The S&P 500 edged 0.1 per cent lower and the Dow Jones Industrial Average was nearly unchanged.
The Nasdaq composite fell 0.6 per cent as Alphabet Inc., parent company of Google, sank 1.5 per cent ahead of its earnings report, which arrived after trading ended. The company posted stronger-than-expected results for its second quarter, a sign that its massive artificial intelligence spending spree is paying off so far. However, its share price fell another 3.5 per cent in premarket trading.
Tesla’s share price dropped 1.3 per cent on Wednesday and another 5.6 per cent in after-hours trading after the car company run by Elon Musk said its profits fell last quarter as it shoveled more money into research and development, cutting into earnings from a sharp increase in vehicle sales.
Investors are looking for signs that the deluge of dollars going into processors, computer memory and other building blocks of the AI boom will yield enough profits to make the investments worthwhile. Such worries have kept AI stocks at the centre of Wall Street’s swings for weeks.
Rising oil prices are weighing on stock prices since they raise costs for most businesses and erode their profits. They also can dent consumer spending.
Early Thursday, the price of a barrel of Brent crude oil, the international standard, was up 4.3 per cent at $98.16, its highest level since early June.
It had fallen to less than $72 earlier this month, roughly where it was before the war with Iran. But continued fighting is preventing oil tankers from using the Strait of Hormuz to exit the Persian Gulf. Normally, a fifth of all oil and natural gas traded passes through the narrow strait.
U.S. benchmark crude gained 3.6 per cent to $89.91 a barrel.
The U.S. military announced Wednesday that it was conducting a 12th night of strikes against Iran as both sides increasingly targeted civilian infrastructure.
Higher oil prices are threatening a reacceleration of inflation, which could push the Federal Reserve and other central banks to raise interest rates, slowing economies and undercutting prices for stocks and other investments.
The yield on the 10-year Treasury rose to 4.65 per cent from 4.63 per cent late Tuesday and from just 3.97 per cent before the war with Iran began. It’s already helped bring long-term U.S. mortgage rates to their highest levels in nearly a year.
In other dealings early Thursday, the euro was unchanged at $1.1414.
Elaine Kurtenbach, The Associated Press
