Asian markets gain on improving oil flows, easing yield concerns

October 05, 2026 (MLN): Asian markets opened broadly higher on Monday, supported by signs of improving oil flows from the Middle East, although elevated U.S. Treasury yields continued to keep investors cautious.

Japan’s Nikkei 225 gained more than 1.7% in early trading, while the broader Topix advanced 0.79%, according to CNBC.

Australia’s S&P/ASX 200 rose 0.53%. Hong Kong’s Hang Seng futures stood at 23,831, compared with the index’s previous close of 23,972.29. Markets in mainland China and South Korea remained closed for holidays.

Investor sentiment was also supported by a moderation in concerns over rising Treasury yields, with markets awaiting minutes from the U.S. Federal Reserve’s latest meeting later this week for clues about the central bank’s future interest-rate path.

Despite the improvement in sentiment, geopolitical risks remained in focus as tensions between the United States and Iran continued. Iranian Parliament Speaker Mohammad Bagher Ghalibaf said the Strait of Hormuz would remain closed until Iran’s conditions for ending the conflict with the U.S. were met.

Meanwhile, the U.S. Air Force withdrew all B-1 bombers stationed at a UK air base that had been used in American military operations against Iran, following an investigation into a planned terror attack, according to the Associated Press.

U.S. stocks ended higher on Friday, with the Dow Jones Industrial Average gaining 250 points, or 0.5%, to close at 51,176.46. The S&P 500 rose 0.7% to 7,722.72, while the Nasdaq Composite advanced 1.2% to 27,190.86 after touching a record high during the session.

Markets were coming off a week marked by a sharp rise in Treasury yields and a weaker-than-expected U.S. jobs report. The softer employment data reduced expectations of another Federal Reserve rate hike this month, providing some relief to equity markets.

However, the 10-year U.S. Treasury yield remained a major concern after reaching its highest level in more than two decades. Investors remain wary that persistently high borrowing costs could weigh on equities even if the Fed keeps interest rates unchanged in the near term.

Technology stocks led Friday’s gains, with Nvidia reaching an intraday record and the Nasdaq also touching an all-time high. Investors will now assess whether the momentum can continue as the new trading week begins.

With relatively limited economic data scheduled, market participants are expected to focus on geopolitical developments, Treasury yields and company-specific news ahead of the upcoming earnings season.

The Institute for Supply Management’s services activity report is due Monday, while minutes of the Federal Reserve’s September meeting are scheduled for Wednesday. The University of Michigan’s preliminary October consumer sentiment reading is also due Friday.

Investors will also turn their attention to corporate earnings, with results from companies including Constellation Brands, Levi Strauss, PepsiCo and Delta Air Lines due during the week.

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