Asia markets soft, oil gains on US Iran negotiations

February 17, 2026 (MLN): Asian markets traded cautiously on Tuesday as holiday closures across key regional bourses kept volumes thin, while oil prices climbed ahead of closely watched U.S.-Iran nuclear negotiations set to begin later in Geneva.

Most major Asian markets including mainland China, Hong Kong, Singapore, Taiwan and South Korea remained closed for Lunar New Year holidays.

U.S. markets were also shut on Monday for Presidents’ Day, further dampening global trading activity, according to CNBC.

In Japan, the Nikkei 225 slipped 0.5%, while the broader Topix index declined 0.2% to close at 3,779.29.

Meanwhile, Australia’s S&P/ASX 200 edged nearly 0.5% higher, supported by gains in select resource and financial stocks.

Futures trading pointed to a muted Wall Street open, with Nasdaq futures down 0.1% and S&P 500 futures up 0.2% during early Asian hours.

U.S. Treasury yields fell modestly, with the benchmark 10-year yield slipping one basis point to 4.044%, marked its lowest level since early December.

In Japan, the five-year government bond yield declined two basis points to 1.65%, the lowest since February 2.

The U.S. dollar index hovered at 97.07 after gaining 0.2% overnight. The Japanese yen strengthened 0.15% to 153.28 per dollar following weaker-than-expected economic data.

Investor focus remained on Japan after disappointing GDP data released Monday showed the economy expanded at an annualized pace of just 0.2% in the fourth quarter, sharply below the 1.6% growth forecast. Government spending weighed heavily on activity.

The weak figures emphasize the economic challenges facing Prime Minister Sanae Takaichi and are likely to bolster calls for stronger fiscal stimulus measures.

The soft data may also temper expectations for near-term monetary tightening by the Bank of Japan (BOJ).

The BOJ is scheduled to meet in March, though traders see only a slim chance of a rate hike. Economists surveyed previously anticipate the central bank may delay further tightening until July.

Market pricing currently shows just four basis points of tightening for March and 16 basis points for April.

In Australia, the Reserve Bank indicated that inflation would likely have remained elevated had it not raised interest rates earlier this month.

However, policymakers signaled uncertainty over whether additional tightening will be required in the coming months.

Crude oil prices moved higher amid geopolitical uncertainty and ahead of renewed nuclear negotiations between the United States and Iran.

U.S. West Texas Intermediate (WTI) crude rose 1.29%, while Brent crude futures gained 1.33% overnight.

Tensions in the Middle East remained in focus after Iran’s Revolutionary Guards navy conducted drills in the Strait of Hormuz on Monday.

The strategic waterway accounts for roughly 20% of global oil shipments, making it a critical chokepoint for energy markets.

Precious metals declined, with gold falling 0.85% to $4,949.5 per ounce as the stronger U.S. dollar made bullion more expensive for holders of other currencies. Spot silver dropped 2% in early trade.

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