Softer-than-expected US CPI data on 14 July provided meaningful relief to global markets, dampening near-term Fed rate-hike expectations and supporting a broad risk-on tone into the overnight session. However, the rally was uneven: US Treasury yields still climbed — the 10-year adding 6 basis points to 4.62% and the 30-year breaching 5.10% — suggesting markets remain alert to the 'higher-for-longer' rate narrative under Fed Chair Kevin Warsh, who has flagged AI infrastructure buildout as a near-term inflationary force even as he acknowledges its longer-run disinflationary potential. Geopolitical risk around the Strait of Hormuz kept energy markets elevated, with Brent crude pushing to $84.73/bbl (+1.72%) and WTI to $79.34/bbl (+1.54%), adding a further inflationary undercurrent to what was otherwise a constructive macro session. The VIX spiked 14.17% to 17.16, a notable disconnect from the headline equity gains that warrants caution about complacency.
For Asia-Pacific markets opening today, the cross-asset read is mixed but skewed cautiously negative for growth-sensitive exposures. The Nikkei sold off 1.92% and the KOSPI dropped a severe 8.95% — the latter a standout risk event that demands attention — while USD/JPY extended to 162.43, maintaining pressure on the BOJ after its June 25bp rate hike. The SSE fell 2.06% despite HKEX nudging marginally higher (+0.16%), reinforcing the China divergence theme. The ASX 200 closed nearly flat (+0.03%) with its own VIX contained at 11.29, but rising commodity prices across gold ($4,061/oz, +1.60%), copper ($6.33/lb, +1.56%), and iron ore ($98.92/t, +0.62%) provide a constructive backdrop for local resources names, even as global tech weakness creates a headwind for ASX growth and technology-exposed stocks.