Global financial markets rebounded on Thursday as investors responded positively to the US Treasury’s decision to increase its purchases of longer-dated government debt, while oil prices remained near multi-week highs amid the continuing standoff between Washington and Tehran.
Brent crude, the international benchmark, rose 0.3 percent to $91.90 a barrel, while US West Texas Intermediate crude increased 0.2 percent to $84.57.
Oil prices have climbed steadily since the beginning of August, when Brent traded at around $87.38 a barrel. Continued uncertainty surrounding the Strait of Hormuz has kept concerns about energy supplies elevated even without a major new escalation.
Both benchmarks remain well above levels recorded before the conflict began.
Attention in financial markets also turned to the US Treasury after it announced that it would at least double the size of certain bond buyback operations. From September, purchases of longer-dated government securities will increase to $4 billion or more per operation, compared with the previous maximum of $2 billion.
The move helped ease pressure in bond markets, where yields had risen to multi-decade highs in recent months. The announcement also improved investor sentiment across Asia following a sharp sell-off in technology and artificial intelligence-related stocks on Wednesday.
South Korea’s Kospi surged 6.1 percent to 6,858.91 after falling 5.8 percent the previous day. Samsung Electronics rose 9.7 percent, while SK Hynix jumped 14.1 percent after announcing a share buyback programme.
Japan’s Nikkei 225 gained about 0.9 percent and the Topix increased 0.8 percent. Hong Kong’s Hang Seng rose 1.1 percent to 25,786.32, while the Shanghai Composite added 0.3 percent to 3,905.23. Australia’s S&P/ASX 200 advanced 0.3 percent to 9,066.40.
Bond yields also moved lower. The yield on the 10-year US Treasury fell to about 4.64 percent from 4.71 percent on Tuesday. The 30-year yield declined to 5.18 percent from 5.28 percent, moving away from its highest level since 2007.
Japanese 10-year government bond yields also eased, falling to around 2.83 percent from above 2.89 percent on Wednesday after reaching a multi-decade high.
Higher borrowing costs in recent months have reflected concerns about inflation, increased government debt and the economic effects of the Middle East conflict.
Wall Street had also recovered on Wednesday. The S&P 500 rose 0.2 percent for its first gain in four sessions, ending a three-day decline. The Dow Jones Industrial Average and Nasdaq Composite each gained 0.2 percent.
In foreign exchange markets, the US dollar rose to 158.60 yen from 158.16, while the euro edged down slightly to $1.1676.
Investors remain focused on the US-Iran dispute, energy supply risks and government borrowing as markets assess whether the latest rebound can continue.
