Asian shares are mixed and oil prices hold steady as the US raises pressure on Iran

BANGKOK (AP) — Asian shares were mostly lower Tuesday after U.S. stocks drifted to a mixed finish ahead of potentially market-moving events later in the week.

Regional benchmarks traded in a narrow range and U.S. futures were nearly unchanged.

Oil prices were little changed after U.S. Treasury Secretary Scott Bessent announced fresh sanctions against Iran and warned that countries persisting in doing business with the Islamic Republic would face retaliation.

Tokyo’s Nikkei 225 gained 0.4% to 65,811.19 and the Kospi in South Korea fell 0.4% to 6,675.88.

Hong Kong’s Hang Seng lost 0.3% to 25,453.19, while the Shanghai Composite index edged 0.1% lower, to 3,878.38.

In Australia, the S&P/ASX 200 gained 0.6% to 9,158.70.

Taiwan’s Taiex edged less than 0.1% lower, while the Sensex in India lost 0.3%.

On Monday, areas of the bond market that the U.S. Treasury Department has been trying to calm eased a bit, relieving pressure on stocks.

The S&P 500 slipped 0.3% and pulled a bit further from its all-time high set earlier this month. The Dow Jones Industrial Average added 0.3% and the Nasdaq composite fell 0.8%.

Tech stocks led the decline following big swings through the summer on worries that the frenzy around artificial-intelligence technology has sent prices too high and huge demand for AI chips will falter if AI doesn’t yield enough profits.

Chip giant Nvidia, a tremendous winner of the AI boom, will deliver its quarterly earnings report on Wednesday. That could dictate the next big move for AI-related stocks.

Nvidia sank 2.9% on Monday and was the heaviest weight on the S&P 500, where the majority of stocks rose. Drops of 5.8% for Micron Technology and 2.6% for Broadcom also helped drag the index lower.

In the bond market, the yield of the 10-year Treasury eased to 4.71% from 4.74% late Friday, returning to where it was last week before the U.S. Treasury Department announced a surprise move to increase the size of its planned buybacks of Treasurys.

While that might help contain the rise in yields for 10- and 30-year Treasurys, analysts say the buybacks are relatively small and will not fix the fundamental problems of excessive U.S. government debt and high oil prices because of the war with Iran.

Longer-term Treasury yields climbed through the summer on worries about high inflation, huge government debts and other factors. High yields make it more expensive for everyone to borrow, not just the government, and already have pushed up mortgage rates and hurt the housing industry.

“The latest discussion about using Treasury General Account cash to help finance purchases of longer-dated bonds gave the market something to chew on Monday, and it initially liked the taste. Long yields fell, and the curve flattened,” Stephen Innes of SPI Asset Management said in a commentary.

“But there is a difference between forcing the bond market to blink for an afternoon and solving the underlying problem,” he said.

The Federal Reserve’s new chairman, Kevin Warsh, is set to deliver a speech Friday at an annual economic symposium in Jackson Hole, Wyoming, the backdrop for past policy announcements.

Analysts say Warsh is likely to talk about inflation and how the Fed plans to deal with it.

Oil prices are a major factor behind higher costs and Brent crude, the international standard, has been trading above the $72 per barrel level it was at before the war with Iran began in late February.

Early Tuesday, Brent was nearly unchanged at $90.51 per barrel. U.S. benchmark crude oil edged less than 0.1% higher, to $85.10 per barrel.

Last month, Brent zigzagged between $72 and $102 as hopes rose and fell that the United States and Iran could reach a deal that would allow oil tankers to freely exit the Persian Gulf again. The new U.S. sanctions announced Monday helped drag the value of Iran’s currency, the rial, to a record low against the U.S. dollar.

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Associated Press Business Writers Stan Choe and Michelle Chapman contributed to this report.