HONG KONG – Asia shares advanced on Wednesday, with benchmarks in Japan and South Korea jumping as oil prices fell back slightly despite a barrage of attacks by Iran on its Gulf neighbors.
U.S. futures rose 0.6% after a session of moderate gains on Wall Street ahead of the Federal Reserve's decision on interest rates later in the day. With higher oil prices feeding into other inflation, the Fed is widely expected to keep rates on hold.
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Worries over global oil and gas supplies and rising prices are still clouding global markets, though Brent crude, the international standard, fell 2% to around $101 per barrel, down from above $106 on Monday.
U.S. benchmark crude fell 3.6% to $92.78 per barrel.
Iran lashed out Wednesday with multiple attacks on its Gulf neighbors and Israel following the killing of one of its top leaders in an airstrike, using some of its latest missiles to evade air defenses and killing two near Tel Aviv.
But markets seem to have taken the latest escalations in stride.
Tokyo's Nikkei 225 gained 2.9% to 55,239.40 after the government reported exports were higher than expected in February.
In South Korea, the Kospi jumped 5% to 5,925.03.
Lower oil prices are a boon for big oil importers like Japan and South Korea.
Hong Kong’s Hang Seng reversed early losses, surging 0.8% to 26,076.00, while the Shanghai Composite index also rebounded, gaining 0.3% to 4,063.77.
Australia’s S&P/ASX 200 climbed 0.3% to 8,640.60.
Taiwan’s Taiex added 1.5% and India's Sensex advanced 0.9%.
Global oil flows remain largely constrained, ING Bank analysts Warren Patterson and Ewa Manthey wrote in a research note on Wednesday, even as hopes were growing that Iran might be allowing more vessels through the Strait of Hormuz, a key waterway for global oil and gas transport.
Roughly a fifth of the world’s crude oil passes through the strait, which has been largely closed as Iran blocks ships linked to the U.S., Israel and their allies.
On Tuesday, U.S. stocks held steadier as the S&P 500 rose 0.3% and the Dow Jones Industrial Average edged 0.1% higher. The Nasdaq composite added 0.5%.
Shares of Delta Air Lines rose 6.6%. The U.S. carrier raised its revenue forecast as it expected strong demand, which could help offset jet fuel cost rises due to the Iran war.
Uber Technologies rose 4.2%, after it announced expanding its partnership with chipmaker Nvidia to launch an autonomous vehicle fleet in the U.S starting with San Francisco and Los Angeles next year.
In other dealings early Wednesday, the U.S. dollar fell to 158.76 Japanese yen from 159.01 yen. The euro climbed to $1.1544 from $1.1542.