Asian shares dip as oil rally cools

Asian share markets began the week with modest declines as oil prices pulled back from recent six‑month highs and investors turned their attention to a crowded calendar of central bank meetings and corporate earnings. Brent crude (UKOUSD) slipped 1.0% to about US$115.48, easing from six‑month highs on supply concerns linked to tensions in the Middle East.

The softer start in equities reflected a mix of profit‑taking and caution rather than a sharp risk‑off move. US crude (USOUSD) futures were also weaker, falling 1.1% to US$102.08 a barrel, contributing to a sense that the latest spike in energy prices might be stabilising, at least temporarily.

Japan’s Nikkei fell 0.8% after a difficult prior week, while South Korean stocks dropped 0.4%, extending steep losses accumulated so far this month. MSCI’s broadest index of Asia‑Pacific shares outside Japan slipped 0.2%, underscoring a generally cautious tone across the region rather than pronounced selling pressure.

MSCI’s Asia Pacific index slipped around 0.2% and Hang Seng futures were little changed, signalling a mixed start after a rough session on Wall Street.

The pullback in Brent reportedly followed Qatari mediators visiting Tehran in coordination with the United States to de‑escalate regional tensions.

The inflation impulse from higher oil is a key concern for central banks meeting this week. Policymakers are seen as engaged in a relatively shallow rate‑hike cycle, but higher energy costs are complicating their task. The prospect of further tightening, or at least a hawkish stance, is one factor encouraging equity investors to stay cautious at the start of the week.

Recent selling in AI‑linked chip stocks has weighed on regional indices, pushing some investors toward bonds and reviving questions about whether earnings can justify the heavy capital being deployed into AI. Shares of major AI‑exposed companies such as SK Hynix (SKHY) and Samsung Electronics are central to this debate, as further loss of momentum in AI could shift attention back to more traditional growth drivers such as consumer demand.

The week’s earnings slate features several large US technology companies viewed as bellwethers for AI‑related demand. Consensus expectations for Microsoft (MSFT) point to revenue of US$90.6 billion and adjusted earnings per share of US$4.73. Amazon (AMZN) is projected to report revenue of US$202 billion and earnings per share around US$1.97, while Alphabet (GOOGL)’s revenue is seen at US$128 billion with earnings per share of US$3.00. Results from these firms, along with reports from chipmakers such as Intel (INTC) and Sandisk (SNDK) and regional players like SK Hynix and Samsung, are expected to further test investor confidence in the AI boom.