Asia Stocks Flat, Oil Prices Fall Ahead of Fed Meeting as Ukraine Peace Hopes Lift Europe Futures

Asian shares traded flat on Tuesday while oil prices slipped, as investors turned cautious ahead of the U.S. Federal Reserve’s annual Jackson Hole symposium. At the same time, hopes for progress in peace negotiations between Russia and Ukraine lifted European equity futures, providing a glimmer of optimism in global markets.

Japan’s Nikkei opened strong, hitting a fresh intraday record high before retreating, weighed down by a sharp 2.5% drop in SoftBank Group following its $2 billion investment in struggling U.S. chipmaker Intel. The broader MSCI Asia-Pacific index outside Japan edged down 0.1% after Wall Street closed with mild losses. Meanwhile, currency markets held steady, with the U.S. dollar maintaining gains as traders awaited signals from Fed Chair Jerome Powell’s upcoming policy outlook.

European futures ticked higher as Ukrainian President Volodymyr Zelenskiy expressed optimism that security guarantees for his country could be finalized within 10 days following discussions with U.S. President Donald Trump and European leaders. NATO Secretary General Mark Rutte described the recent diplomatic meetings, including Trump’s engagement with Russian President Vladimir Putin, as “very successful,” even as the Ukraine war enters its fourth year without a ceasefire.

Energy markets reflected investor caution, with U.S. crude falling 0.8% to $62.92 per barrel and Brent crude slipping 0.7% to $66.15. Analysts noted that renewed peace talks could reshape global oil flows by easing sanctions on Russian crude. Spot gold rose slightly to $3,337.41 per ounce, while Bitcoin and Ether also declined, sliding 1% and 2.7% respectively, amid broader market uncertainty.

Attention now shifts to the Fed’s Jackson Hole gathering from August 21–23, where policymakers are expected to address monetary strategy amid high inflation risks. According to CME FedWatch, money markets are pricing in an 83.6% chance of a quarter-point rate cut at the central bank’s September meeting. Analysts warn that investor sentiment remains fragile, with equities reliant on a dovish Fed stance and geopolitical tensions adding to volatility across global markets.

Source: Reuters