Asian equities rebounded ahead of key US inflation data, with MSCI’s Asia Pacific Index rising 0.5% after two consecutive sessions of losses. US stocks also recovered from earlier declines after New York Fed President John Williams indicated that another rate hike could be appropriate this year, although further tightening may not be necessary in 2027. Investors remain cautious as incoming inflation data could influence the Federal Reserve’s next policy decisions.

Technology stocks faced renewed pressure after ASML warned that supply would not fully meet demand over the next two years, despite raising the lower end of its 2026 sales outlook amid strong AI-driven demand. Meanwhile, China’s CSI 300 fell 0.3%, approaching bear-market territory after declining more than 15% from its June peak, as concerns grew over the effectiveness of economic stimulus measures.

Oil prices moved higher as escalating attacks across the Middle East threatened the outlook for regional energy supplies. Brent crude rose 0.6% to $106.30 a barrel after Yemen’s Houthi militants struck Saudi Aramco’s executive headquarters in eastern Saudi Arabia, triggering a fire. The incident heightened concerns over the security of energy infrastructure and the recovery of shipments through the Persian Gulf.

In Europe, European Central Bank President Christine Lagarde said elevated energy-driven inflation had yet to spread throughout the broader economy. Meanwhile, China’s trade surplus reached $938 billion in the first nine months of the year as export growth accelerated. Chinese consumer and producer inflation also increased, reflecting higher energy costs and rising prices for AI-related goods.

Elsewhere, President Donald Trump said Taiwan had agreed to purchase 30% of the gas from an Alaskan energy project over the next 20 years, highlighting the growing role of energy trade in US economic and political priorities.

Markets now turn to US CPI data, with monthly inflation expected to accelerate to 0.6% from 0.4%. A stronger-than-expected reading could reinforce concerns over persistent inflation and further interest-rate increases, while continued instability in the Middle East keeps oil prices and energy supply risks firmly in focus.

FISG Daily Market Wrap provides a concise view of the forces moving global markets, helping investors stay informed and better prepared for what comes next.

FISG — Interstellar Group