Asian Markets Mixed as Yen Strengthens on U.S.-Japan Intervention, Oil Retreats on Iran Ceasefire Prospects

Asian equity markets delivered a mixed performance Monday following confirmation that U.S. and Japanese authorities had jointly intervened to support the yen’s value against the dollar. The currency climbed to its strongest level since late last year, trading as low as 155.20 against the dollar compared with approximately 164 yen the previous week before the intervention took place.

Japan’s Nikkei 225 index fell 1.9% to 63,140.68, while South Korea’s Kospi dropped 4.5% to 6,298.75 after an extraordinary rally Friday that represented the index’s best day on record. Hong Kong’s Hang Seng gained 0.6% to 26,038.92, and Taiwan’s Taiex rose 0.7%, though Shanghai’s Composite index declined 0.5% to 3,812.97 and Australia’s S&P/ASX 200 slipped 0.2% to 8,961.30.

A stronger yen presents competing economic effects for Japan. While a robust currency benefits domestic purchasing power for imports including oil and other essential goods, it simultaneously reduces the competitive advantage for Japanese exporters whose overseas earnings diminish when converted back into stronger yen.

Crude oil prices tumbled sharply following President Donald Trump’s statement that he would direct U.S. military forces to cease operations against Iran, signaling imminent deal-making to resolve Middle East hostilities. U.S. benchmark crude declined 4.8% to $80.58 per barrel, while Brent crude fell 5% to $83.87 per barrel.

U.S. stock markets capped a volatile July by finishing Friday with gains across all three major indexes. The S&P 500 climbed 0.7%, the Dow Jones Industrial Average advanced 0.5%, and the Nasdaq composite rallied 1% after erasing an earlier 1.3% gain, marking the S&P 500’s first winning week in three.

Amazon drove market momentum with a 15.3% surge after posting quarterly profits that more than tripled year-over-year, exceeding analyst expectations and boosted by accelerating cloud computing revenue. The company raised its investment spending forecast, signaling that artificial intelligence expenditures may be generating tangible returns.

Technology stocks remained volatile, with Microsoft’s stock gaining from earlier strength on signals that its AI initiatives are producing profitable results. Semiconductor manufacturers including Micron Technology oscillated sharply, with Micron falling 5.9% after a volatile session, as chipmakers grapple with surging demand from artificial intelligence infrastructure buildout.

Apple declined 7.4% despite beating profit expectations, as executives attributed disappointing revenue guidance to component supply constraints driven by the AI technology boom. The euro strengthened to $1.1533 from $1.1528 as currency markets absorbed the week’s geopolitical and monetary developments.