Oil Mixed, Asian Stocks Lower Amid Caution Over Mideast, U.S. Midterms

By Sherry Qin

Oil prices were mixed and Asian equities moved lower early Tuesday amid cautious sentiment over developments in the Middle East and ahead of the U.S. midterm elections.

The U.S. attacked Iran's Qeshm Island on Monday, U.S. officials said, marking the latest of a series of limited strikes Washington has carried out against the country in recent weeks as President Trump touted the possibility of a diplomatic deal.

"Oil Prices are DROPPING LIKE A ROCK, down almost $10 a Barrel, A RECORD, because people feel that there will not be a War with Iran. Iran wants a settlement, as soon as possible. It could happen!" Trump posted on Truth Social on Monday.

Iran's Foreign Ministry spokesperson Esmail Baghaei told reporters Monday in Tehran that "the ball is in the U.S. court" regarding any prospective deal to end the conflict.

"The oil market is also wary of stop-and-go diplomatic efforts that haven't delivered peace, with the two adversaries yet to agree on terms for fully reopening the Strait of Hormuz," ANZ Research analysts said in a note, adding that attention remains focused on physical oil flows.

Front-month West Texas Intermediate crude-oil futures was up 0.2% at $96.65 a barrel, while front-month Brent crude oil was flat at $104.73 a barrel.

Meanwhile, Asian equity markets remained weighed down by investor skepticism surrounding record artificial-intelligence spending. South Korea's Kospi was down 3.05%, Taiwan's Taiex was down 1.0% and China's Shanghai Composite Index opened 0.4% lower. Japan's markets were closed for a public holiday.

Semiconductor-related stocks remained the biggest losers. South Korean memory giants SK Hynix and Samsung Electronics were down 3.8% and 3.5%, respectively. Taiwan's MediaTek fell 2.4% and Foxconn Technology was down 1.0%.

"The market hasn't lost faith in AI, but it's losing patience with companies spending extraordinary sums without delivering returns that exceed already lofty expectations," said Pepperstone head of research Chris Weston in a note.

In the currency market, the yuan weakened against the dollar after the People's Bank of China said Tuesday morning that it would raise the foreign-exchange reserve requirement ratio for financial institutions by 2 percentage points to 6%.

The decision, effective Nov. 15, aims to improve the management of foreign-exchange liquidity, the central bank said in a statement. The move requires Chinese financial institutions to lock up an additional 2% of their foreign-currency deposits with the central bank, tightening dollar liquidity in domestic markets and cooling the yuan's appreciation.

The PBOC has sent a clear message to the market that it is concerned about the fast appreciation of the yuan, said Zhiwei Zhang, chief economist at Pinpoint Asset Management.

The greenback was last 0.3% higher at 6.67 onshore yuan and also 0.3% higher at 6.66 offshore yuan.

Write to Sherry Qin at sherry.qin@wsj.com

(END) Dow Jones Newswires

November 02, 2026 21:26 ET (02:26 GMT)