US vs Iran
Oil prices fall as US plans to isolate Iranian economy
Oil prices fell on Monday as investors braced for details of a United States plan to isolate the Iranian economy. President Donald Trump billed this plan as the "most crushing" financial operation ever against Tehran, with both main crude contracts down 2.3 per cent and the Brent benchmark sitting at US$92 a barrel.
Economic Impact
The plan to isolate the Iranian economy is expected to have a significant impact on the global economy. According to US Vice President JD Vance, the plan is a "delicate dance" because Iran will "try to apply economic pressure to us". The United States has warned allies and China to join Trump's new campaign, which comes as the unpopular war in the Middle East drags toward the six-month mark.
Asian stocks were mostly down in early trading, with South Korea's tech-rich Kospi falling 1.4 per cent. The chip giant Samsung Electronics said it spent a massive US$80 billion to buy back its own shares following weeks of turbulent trading.
Market Watch
Traders will also be watching this week's annual gathering of central bankers, economists and finance chiefs in Jackson Hole in the United States, hoping for some clarification on US monetary policy. The meeting comes after the Treasury bought its own bonds last week in an effort to push down borrowing costs after the 30-year yield surged to levels last seen in 2007, just before the global financial crisis.
| Market | Change |
|---|---|
| South Korea's Kospi | -1.4% |
| Hong Kong | -2% |
| Sydney | + |
| Jakarta | + |
| Bangkok | + |
| Manila | 0 |
| Kuala Lumpur | 0 |
The US Treasury boss Scott Bessent said he would give more details in a news conference on Monday on a fresh push to pile economic pressure on Iran. Bessent called on Beijing "to get with the programme" but said "many conversations are best to have in private" when asked whether the United States would pressure China.
Company News
Chinese tech giant Alibaba is keeping focus on the AI sector after announcing on Sunday that it plans to issue US$10.2 billion in new shares in Hong Kong to fund its global AI ambitions. The firm has been ploughing tens of billions of dollars into the technology, with shareholders eager to see how it will monetise the huge investments. Fast-fashion giant Shein announced its market debut will take place in the Chinese financial hub on Sep 1, which would value the group at close to US$27 billion.
According to Stephen Innes of SPI Asset Management, "the spending machine is still running, but the bill is getting heavier". Innes said Nvidia must now show that the most expensive investment boom in modern market history can still pay its bills. Yields have risen on inflation fears and as the United States reported that its federal debt had topped US$40 trillion.
