Asian stocks rebound as oil pulls back from highs amid US-Iran tensions

Global markets steadied on Thursday after a volatile stretch driven by escalating US-Iran hostilities, with oil prices pulling back from their midweek highs and Asian equities recovering some of their steep losses. The partial calm came as diplomatic channels remained active, with mediators working to salvage a fragile interim agreement between Washington and Tehran even as both sides exchanged fresh strikes.home+1

Oil Eases, Asia Rebounds

Brent crude fell about $1 to $77 a barrel on Thursday, retreating from briefly topping $80 on Wednesday after the United States launched a second night of strikes against Iranian targets and revoked a waiver on Iranian oil exports. The pullback offered some relief to markets that had been roiled by energy-driven inflation fears.reuters+1

Tokyo's Nikkei 225 reversed some of its earlier-week losses, gaining 1.4% to 67,743.85, helped by technology shares including chip equipment maker Tokyo Electron, which jumped 5.5%. South Korea's Kospi rose 0.6% to 7,291.91 after plunging 5.4% on Wednesday, while the Shanghai Composite traded 1.7% higher.wsls

European Stocks Eye Recovery After Sharp Selloff

European markets were positioned to rebound after the Stoxx 600 fell 1.6% on Wednesday, with the DAX and CAC 40 both losing 2.2% and the FTSE 100 dropping 1.7%. However, the UK benchmark faced a headwind from AstraZeneca ↘ 6.26%, whose shares plunged nearly 10% on Thursday after its gene-silencing drug Wainua, developed with Ionis Pharmaceuticals ↘ 22.20%, failed to meet its primary endpoint in a late-stage trial for a rare heart condition.wsj+2

Geopolitical Risk Remains Elevated

The market stabilization came despite unresolved tensions. President Trump declared the US-Iran ceasefire "over" earlier in the week, and Iran responded by firing at targets in Bahrain, Kuwait, and Qatar. Still, a regional intelligence official involved in mediation said high-level talks aimed at salvaging an interim peace agreement remain underway.cbsnews+1

The IMF on Wednesday lowered its 2026 global growth forecast to 3.0%, warning of ongoing risks from the Middle East conflict and projecting global inflation at 4.7% for the year. With hawkish Federal Reserve minutes also weighing on sentiment, investors face a tense backdrop heading into US jobless claims data and a 30-year Treasury bond auction later Thursday.reuters+2