Asia report: Stocks gain as oil prices fall for third day

(Sharecast News) - Asian equities finished the session mostly higher on Wednesday as a slide in oil prices soothed fears about inflation.

The Nikkei 225, Hang Seng and Shanghai Composite all settled 0.6% higher, while the KOSPI gained 1.0%. Meanwhile, the Sensex finished flat and the Singaporean STI fell 0.2%.

Brent crude was down 2.7% at $84.92 a barrel just after markets closed in Asia, amid increasing optimism about diplomatic developments in the Middle East.

This was Brent's third straight day in the red and puts the commodity on track for its lowest settlement price since 7 August, after diplomats in Iran and Oman said they discussed an agreement to resume shipping through the Strait of Hormuz.

"Discussions between Iran and Oman over the establishment of a temporary corridor through the Strait of Hormuz, US sanctions on Tehran which were less strict than expected, and hints at continuing diplomatic efforts have helped bring Brent crude oil down to $86 per barrel," said AJ Bell investment director Russ Mould.

"This has helped take the edge off market fears about inflation and brought government bond yields down. The improving picture helped fuel a recovery in Asian stocks."

However, Mould said upcoming results from semiconductor giant Nvidia - due out after the markets close on Wednesday - "are likely to set the tone for markets through the remainder of the week".

"Investors typically assume Nvidia will always beat expectations, so the AI chip giant will have to produce or say something very special to truly impress the market," he said.

Chipmakers and tech names across Asia performed relatively well during Wednesday's session, including TSMC, Samsung Electronics, SK Hynix and SMIC.