Oil prices rise and stocks waver as Middle East violence flares, adding
to uncertainty
[September 01, 2026] By
ELAINE KURTENBACH
BANGKOK (AP) — Oil prices climbed further and Asian shares were mixed
Tuesday as recurring violence in the Iran war after more than a month
with no significant fighting heightened uncertainty over the future of
the conflict.
Shares in online fast-fashion retailer Shein fell as much as 10% after
they began trading in Hong Kong on Tuesday. By midday they were 5%
lower.
Brent crude gained 0.8% to $91.23 per barrel. It gained 2.7% on Monday
after the U.S. attacked rocket launchers on an Iranian island on Sunday,
saying they were preparing to launch mines into the Strait of Hormuz.
Iran responded by launching missiles at U.S. sites in Jordan, all of
which were intercepted.
The war has curtailed traffic in the Strait of Hormuz, which once
accounted for about 20% of the world’s oil shipments. Oil prices remain
high after an initial surge earlier in the war, and that has made
everything from gasoline to shipped goods more expensive.
U.S. benchmark crude was up 1% at $86.62 per barrel.
In Asian share trading, Hong Kong's Hang Seng fell 0.9% to 25,332.10 and
the Shanghai Composite index was nearly unchanged, at 3,985.93.
Tokyo's Nikkei 225 edged 0.2% higher, to 66,420.26, while the Kospi in
South Korea added more than 0.2%, to 6,835.51.
The S&P/ASX 200 in Australia slipped 0.1% to 9,066.40.
Taiwan's Taiex picked up 0.2% and the Sensex in India gained 0.3%.
U.S. futures were 0.1% higher.
Wall Street closed out August on a downbeat note Monday as the S&P 500
index fell 0.3%. The Dow Jones Industrial Average dropped 0.7% and the
Nasdaq composite slipped 0.1%.
Monday’s losses were broad, with nearly every sector within the
benchmark S&P 500 finishing in the red.
Edison International slumped 23.1% and PG&E fell 20.1% for the two
steepest declines. That followed reports about potential California
wildfire legislation that would allow insurers to sue utilities over
related claims.
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Currency traders watch monitors at the foreign exchange dealing room
of the Hana Bank headquarters in Seoul, South Korea, Tuesday, Sept.
1, 2026. (AP Photo/Ahn Young-joon)
 But energy stocks notched gains.
Exxon Mobil rose 2.7% and Chevron rose 2.1%.
Higher energy prices have fueled already stubbornly high inflation,
well above the Federal Reserve's 2% target. That has been weighing
on household spending and consumer confidence and given the Fed a
more complicated path ahead for its interest rate policy.
The yield on the two-year Treasury, which closely tracks
expectations about Fed moves, held steady Monday at 4.34%, where it
was late Friday. That’s up significantly from about 3.50% at the
beginning of 2026.
The yield on the 10-year Treasury rose to 4.75% from 4.73% late
Friday. That's back up around the level seen two weeks ago when the
Trump administration took the unusual step of announcing it would
intervene in the bond market.
Any increase to interest rates that could cool inflation also risks
hurting the jobs market. Later this week, the U.S. will report
August jobs data. In July, the U.S. job market stalled unexpectedly
as employers cut 23,000 jobs. Labor Department revisions slashed
another 103,000 jobs from May and June payrolls.
In other dealings early Tuesday, the U.S. dollar rose to 159.94
Japanese yen from 159.74 yen. The euro slipped to $1.1604 from
$1.1619.
___
AP Business Writers Alex Veiga, Damian Troise and Michelle Chapman
contributed to this report.
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