Seoul Gazette - Oil extends gains after fresh US strikes

Rising oil prices hit European equities, while Asian stocks mostly climbed after tech firms enjoyed some reprieve from the latest bout of selling.

The latest attacks came after Iranian forces struck a commercial ship in the Strait of Hormuz early on Sunday, before announcing the closure of the waterway through which about a fifth of global oil passes.

That led to a series of US strikes on sites in the Islamic republic, prompting Tehran to respond by hitting targets in Bahrain, Jordan, Kuwait and Oman.

US President Donald Trump vowed to reimpose a naval blockade on Iranian ports, though he said a deal with Iran was still possible.

"The prospect of more fighting and a fresh blockade has meant that traffic through the Strait has slowed to a near halt," said Kathleen Brooks, research director at trading group XTB.

"When the supply chain gets gummed up, this is what keeps upward pressure on the oil price," she added.

International benchmark Brent North Sea crude rose as much as five percent to trade around $87 a barrel on Tuesday.

Prices had already shot up more than nine percent on Monday.

Equity markets in Asia and Europe were mixed, though confidence remained fragile as traders worried that the sector's AI-led rally has gone too far.

Seoul ended in positive territory after wild swings that saw it drop as much as five percent at one point.

South Korean chip titan SK hynix ended up more than three percent, the day after a 15 percent collapse. Rival Samsung was up 3.3 percent.

Tokyo, Hong Kong, Shanghai, Singapore, Manila and Jakarta were also up, though Wellington, Taipei, Mumbai and Bangkok fell.

Investors are looking ahead to a big week, with earnings season kicking off, Federal Reserve boss Kevin Warsh due to testify in Congress and US inflation data set to be released.

"A softer-than-expected (inflation) reading could revive hopes for lower borrowing costs and lift equity markets, while a hotter print would likely send Treasury yields and the dollar higher, piling fresh pressure on stocks," said Susannah Streeter, chief investment strategist at Wealth Club.

The latest surge in oil prices reignited concerns that another spike in inflation could force the Fed and other central banks to hike interest rates soon.

Fed governor Christopher Waller stoked fears over an early interest rate hike.

"If we get another hot reading on core inflation this week, then the (rate-setting committee) will need to consider tightening monetary policy in the near term," he said on Monday.

The market currently sees a 39 percent chance the Fed will raise interest rates at its meeting later this month, but that rises to more than 76 percent in September.

- Key figures around 1100 GMT -

Brent North Sea Crude: UP 4.9 percent at $87.34 a barrel

West Texas Intermediate: UP 3.7 percent at $81.01 a barrel

London - FTSE 100: DOWN 0.4 percent at 10,456.89 points

Paris - CAC 40: DOWN 0.9 percent at 8,292.57

Frankfurt - DAX: DOWN 0.8 percent at 24,917.04

Tokyo - Nikkei 225: UP 0.7 percent at 67,743.50 (close)

Seoul - Kospi: UP 0.7 percent at 6,856.83 (close)

Hong Kong - Hang Seng Index: UP 0.5 percent at 24,340.73 (close)

Shanghai - Composite: UP 1.4 percent at 3,967.13 (close)

New York - Dow: DOWN 0.3 percent at 52,498.64 (close)

Euro/dollar: UP at $1.1390 from $1.1384 on Monday

Pound/dollar: UP at $1.3368 from $1.3353

Dollar/yen: DOWN at 162.25 yen from 162.43 yen

Euro/pound: DOWN at 85.23 pence from 85.25 pence

V.Pyo--SG