Expectations that lower energy costs could ease inflationary pressure supported buying in global markets, led by the United States. Declines in oil prices and bond yields strengthened expectations that inflation could be brought under control.
Analysts said that if energy prices did not rise, the U.S. Federal Reserve could move closer to its inflation target more easily. The continued strength of the U.S. economy also contributed to the manageability of tight monetary policy.
November Brent futures fell 1.3% to $103.4 a barrel. While concerns over conflict between Saudi Arabia and the Houthis in Yemen continued, expectations that alternative routes could be found for oil shipments from the Middle East contributed to the decline in prices.
U.S. President Donald Trump said he was at a critical decision point over how the war with Iran would proceed. Trump said he had to decide on intervention against Iran.
U.S. indexes and gold rise
The yield on the U.S. 10-year Treasury note remained broadly unchanged at 4.94%. Gold rose 0.5% to $4,363 an ounce, while the dollar index remained above 100 on expectations that the Federal Reserve would maintain its tight monetary policy.
On the New York Stock Exchange, the Dow Jones gained 0.61%, the S&P 500 rose 1.14% and the Nasdaq advanced 1.69%. The average price of diesel in the United States rose to approximately $6.40 per gallon, setting a new record.
The number of people filing initial jobless claims fell to 196,000 in the week ending Sept. 12, below market expectations. U.S. stock index futures also opened higher.
European markets gain support from falling oil prices
European stocks rose on expectations that geopolitical tensions could ease and as oil prices declined. Gains in shares of automotive, telecommunications and retail companies supported regional indexes.
The Bank of England kept its policy rate at 3.75%, in line with expectations. The decision was taken with six members voting to leave rates unchanged and three voting for a 25-basis-point increase.
The bank forecast that inflation could rise to slightly above 4% in the first quarter of 2027. It said it would reduce its bond portfolio through 2034, planning an average annual reduction of £46 billion.
BoE Governor Andrew Bailey said monetary policy could be tightened further if the conflicts in the Middle East lasted longer and second-round effects increased. Consumer prices in the euro area rose 0.4% month on month and 3.2% year on year in August.
The FTSE 100 in the United Kingdom rose 1.19%, France's CAC 40 gained 0.57%, Italy's FTSE MIB advanced 0.80% and Germany's DAX increased 0.77%. European stock index futures opened mixed.
Markets track the BoJ's rate decision in Asia
Lower energy prices and a recovery in technology stocks influenced Asian markets. The Bank of Japan raised its policy rate by 25 basis points to 1.25%. The decision passed by a vote of 7 to 2.
The BoJ said the Japanese economy was expected to continue its moderate growth. The bank said developments in the Middle East and rising demand for artificial intelligence posed inflationary risks, adding that rate increases could continue depending on economic activity and financial conditions.
The lack of unanimity in the rate decision increased uncertainty over the sustainability of tight monetary policy in Japan. The dollar-yen exchange rate rose 0.2% to 157.2, while Japan's inflation rate in August was 1.9%, slightly below expectations.
Near the close, the Kospi rose 2.6%, the Nikkei 225 gained 1.8%, the Hang Seng advanced 0.7% and the Shanghai Composite increased 1%.
BIST 100 gains 2.95%
The BIST 100 index on Borsa Istanbul finished the day up 2.95% at 13,509.76 points. The October futures contract based on the BIST 30 index also rose 0.2% in the evening session compared with the regular-session close.
The dollar-Turkish lira exchange rate ended the day up 0.2% at 48.7330. The currency traded at 48.7660 at the opening of the interbank market, 0.1% above the previous close.
The Central Bank of the Republic of Türkiye announced that liquidity conditions would be closely monitored and that additional measures would be taken if deemed necessary. The Capital Markets Board decided to suspend trading in all investment funds of seven portfolio management companies traded on TEFAS and to liquidate some funds.
The Banking Regulation and Supervision Agency decided that banks should not count their own shares repurchased after Sept. 16 as a deduction from core capital through Dec. 31. Those shares will also be excluded from calculations of amounts subject to credit and market risk.
Analysts said 13,700 and 13,800 points were resistance levels for the BIST 100 index, while 13,400 and 13,300 points were support levels. During the day, markets will monitor Türkiye's international investment position for July, U.S. industrial production and capacity utilization for August, U.K. retail sales, Germany's producer prices and the euro area's current account balance.
