Risk sentiment on Wednesday was pulled in two directions: modest US equity weakness (S&P 500 -0.14%, Nasdaq -0.57%) contrasted with a powerful commodity rally as geopolitical tensions centred on Iran and Strait of Hormuz threats drove Brent crude up 5.21% to $95.75/bbl and WTI up sharply, while gold added 1.32% to $4,124.90/oz on safe-haven demand. European indices outperformed — FTSE 100 +1.24%, DAX +0.66%, Euro Stoxx 50 +0.94% — buoyed by energy and materials strength, with the ECB's 23 July rate decision the dominant forward-looking event, markets pricing near-certain hold after June's 25bp hike. The VIX eased 2.4% to 16.64, suggesting US equity participants are not yet in panic mode, even as bond yields drifted higher with the US 10-year rising 3bp to 4.63% and the 30-year touching 5.13%. After hours, Alphabet's beat on $119.8bn in revenue and a capex raise to $195–205bn for 2026, alongside Tesla's mixed print (revenue beat, EPS miss), set the tone for a tech-driven narrative heading into Thursday's Asian open.
For Asia-Pacific markets, the dominant read-through is commodity-positive: the sharp rally in crude and precious metals provides a constructive backdrop for ASX energy and gold names, while the Nikkei's +3.26% surge and KOSPI's +3.56% gain — both captured in Wednesday's closing data — reflect the region's own momentum, though Nikkei VIX falling 10.28% to 33.07 signals some relief after prior volatility. The AUD slipped 0.14% to $0.6991, a mild headwind for import costs but broadly supportive of Australian commodity export revenues denominated in USD. The ASX 200 closed virtually flat at 8,793.3 (+0.02%) in the prior session, but the overnight commodity surge and Alphabet capex upgrade point to a firmer open for ASX materials, energy and select tech-infrastructure names today, with the high-impact domestic employment data at 11:30 AEST the key local wildcard.