Asian markets began the week on a mixed note as investors weighed falling oil prices, fresh production plans from OPEC+, and weakness in technology stocks. With U.S. markets closed for the Independence Day holiday, trading across the Asia-Pacific region remained cautious, while U.S. stock futures pointed to a mixed opening.
Technology shares were among the biggest drags on regional indices. In Japan, heavyweight investor SoftBank Group fell 3.4%, while semiconductor equipment manufacturer Tokyo Electron declined 1.4%, contributing to losses on the Tokyo Stock Exchange. South Korean technology stocks also came under pressure, pulling the broader market lower. Japan’s Nikkei 225 slipped 0.4%, while South Korea’s Kospi fell 0.8%, reflecting investor concerns over the tech sector and broader market sentiment.
Oil retreats after OPEC+ boosts production
Crude oil prices moved lower after OPEC+ announced that seven member countries would collectively increase oil production by 188,000 barrels per day starting in August. The decision marks the fifth consecutive monthly production increase by the alliance, signalling its continued effort to gradually restore supply to global markets.
The countries participating in the latest output increase include Saudi Arabia, Russia, Iraq, Kuwait, Kazakhstan, Algeria, and Oman. Despite the additional supply, uncertainty surrounding global energy markets remains. Investors continue to monitor developments in the Middle East, where negotiations involving Iran and the potential reopening of the Strait of Hormuz have reportedly stalled amid ongoing funeral ceremonies for Ayatollah Ali Khamenei. The strategically important waterway remains a key route for global oil shipments, making any disruption closely watched by energy markets. In early trading, Brent crude, the global benchmark, declined 25 cents to $71.87 per barrel, while U.S. West Texas Intermediate crude fell 10 cents to $68.59 per barrel.
Chinese markets outperform peers
While Japanese and South Korean equities weakened, Chinese markets posted modest gains. Hong Kong’s Hang Seng Index advanced 0.8%, supported by buying across select sectors, while the Shanghai Composite edged 0.1% higher. Australia’s S&P/ASX 200 remained largely unchanged, slipping just 0.1% as investors assessed global economic signals.
In currency markets, the U.S. dollar strengthened against the Japanese yen, rising to 161.92 yen from 161.34 yen. The euro eased slightly to $1.1432 from $1.1440. With Walled on Friday for the U.S. Independence Day holiday, investors are expected to look for fresh economic data and corporate updates later this week to gauge the direction of global markets.
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