Asia-Pacific markets opened higher on Wednesday, tracking gains on Wall Street as easing oil prices and strong corporate earnings boosted investor sentiment, while signs of de-escalation in the Middle East further supported risk appetite.
Investor optimism was lifted after United States President Donald Trump said efforts to secure a diplomatic resolution with Iran were progressing, prompting a temporary pause to the U.S. naval operation in the Strait of Hormuz.
“We have mutually agreed that, while the Blockade will remain in full force and effect, Project Freedom will be paused for a short period of time to see whether or not the Agreement can be finalised and signed,” Trump said in a Truth Social post.
The U.S. military had begun escorting commercial vessels through the waterway earlier in the week under “Project Freedom”.
U.S. Defence Secretary Pete Hegseth said on Tuesday that “two U.S. commercial ships, along with American destroyers, have already safely transited the strait, showing the lane is clear.”
By 11:05 am AEST (1:05 am GMT), Australia’s S&P/ASX 200 rose 0.7%, while South Korea’s KOSPI 200 surged 5.6% to a fresh record high. Japan’s Nikkei 225 remained closed for a public holiday.
In economic data, South Korea’s inflation rate accelerated to its fastest pace in nearly two years in April, driven largely by higher energy costs linked to the Middle East conflict.
Consumer prices rose 2.6% year-on-year, up from 2.2% in March and in line with expectations, marking the largest annual increase since July 2024.
On a monthly basis, the consumer price index increased 0.5%, following a 0.3% rise previously.
The gains were led by a 7.9% jump in petroleum product prices and a 13.5% surge in international airfares, according to official data.
Overnight in the United States, major equity benchmarks closed higher, with the S&P 500 and Nasdaq Composite both reaching new record highs. The Dow Jones Industrial Average gained 0.7%, the S&P 500 rose 0.8%, and the Nasdaq advanced 1%.
In commodities, oil prices fell sharply, with ICE Brent crude declining 4% to settle at $109.87 per barrel. Spot gold rose 0.8% to $4,556.50 per ounce.
Elsewhere in the region, mainland Chinese markets were closed for a public holiday, with both the Shanghai Composite and CSI 300 not trading.
Hong Kong’s Hang Seng Index fell 0.8% to 25,898.6, while India’s BSE Sensex declined 0.3% to 77,017.8.
European markets delivered a mixed performance, with the UK’s FTSE 100 falling 1.4% to 10,219.1. Germany’s DAX rose 1.7% to 24,401.7, while France’s CAC 40 added 1.1% to close at 8,062.3.
