Expectations that oil shipments from the Middle East could continue via alternative routes contributed to the decline in energy prices. While concerns over clashes between Saudi Arabia and Yemen's Houthis persisted, the price of November-dated Brent crude fell 1.3% to trade at $103.4 per barrel.
The decline in oil prices and falling bond yields strengthened risk appetite in global markets. Expectations that lower energy costs could limit inflationary pressures supported positive trading in several markets, particularly the United States.
Analysts said that if energy prices did not rise, the Federal Reserve could approach its inflation target more easily. They also assessed that the continued strength of the U.S. economy was making tight monetary policy more manageable.
U.S. President Donald Trump said he was at a critical decision point over how the war with Iran would proceed. Trump said he had to decide on intervention against Iran.
U.S. markets continue to rise
The yield on the U.S. 10-year Treasury note was flat at 4.94%, while the price of gold rose 0.5% to $4,363 per ounce. The dollar index remained above 100 amid expectations that the Fed would maintain its tight monetary policy.
On the New York Stock Exchange, the Nasdaq gained 1.69%, the S&P 500 rose 1.14% and the Dow Jones advanced 0.61%. The average price of diesel in the United States rose to approximately $6.40 per gallon, setting a new record.
The number of people filing initial claims for unemployment benefits fell to 196,000 in the week ending September 12, coming in below market expectations. U.S. stock index futures also started the new day higher.
Interest rate decision and conflict risk watched in Europe
European stocks drew support from the decline in oil prices amid expectations that geopolitical tensions could ease. Gains in shares of automotive, telecommunications and retail companies influenced regional indexes.
The Bank of England kept its policy rate at 3.75%, in line with expectations. The decision was taken with six members voting to leave rates unchanged and three voting for a 25-basis-point increase.
The bank projected that inflation could rise to slightly above 4% in the first quarter of 2027. The bank, which said it would reduce its bond portfolio through 2034, planned an average annual reduction of £46 billion.
BoE Governor Andrew Bailey said monetary policy could be tightened further if the conflicts in the Middle East continued and second-round effects increased. In the euro area, consumer prices rose 0.4% month on month and 3.2% year on year in August.
The FTSE 100 in the United Kingdom rose 1.19%, France's CAC 40 gained 0.57%, Italy's FTSE MIB advanced 0.80% and Germany's DAX increased 0.77%. European stock index futures, meanwhile, started the day mixed.
BoJ decision stands out in Asian markets
Asian stocks rose on the decline in energy prices and a recovery in technology shares. The Bank of Japan raised its policy rate by 25 basis points to 1.25%. The decision passed by a vote of 7 to 2.
The BoJ said the Japanese economy was expected to continue its moderate growth. The bank said developments in the Middle East and rising demand for artificial intelligence posed inflationary risks, and announced that rate increases could continue depending on economic activity and financial conditions.
The lack of a unanimous vote on the rate increase heightened uncertainty over the sustainability of tight monetary policy in Japan. The dollar-yen exchange rate rose 0.2% to 157.2, while Japan's August inflation rate came in at 1.9%, slightly below expectations.
Near the close, the Kospi rose 2.6%, the Nikkei 225 gained 1.8%, the Hang Seng advanced 0.7% and the Shanghai Composite increased 1%.
BIST 100 index gains 2.95%
The BIST 100 index on Borsa Istanbul ended the day up 2.95% at 13,509.76 points. The October futures contract based on the BIST 30 index also rose 0.2% in the evening session compared with the regular-session close.
The dollar/Turkish lira exchange rate ended the day up 0.2% at 48.7330. The rate traded at 48.7660 at the opening of the interbank market, 0.1% above the previous close.
The Central Bank of the Republic of Türkiye announced that liquidity conditions would be closely monitored and that additional measures would be taken if deemed necessary. The Capital Markets Board decided to suspend trading in all investment funds of seven portfolio management companies traded on TEFAS and to liquidate some funds.
The Banking Regulation and Supervision Agency decided that banks would not count shares of their own stock repurchased after September 16 as a deduction item from core capital through December 31. Those shares will also be excluded from calculations of amounts subject to credit and market risk.
Analysts said that 13,700 and 13,800 points were resistance levels for the BIST 100 index, while 13,400 and 13,300 points were support levels. During the day, Türkiye's international investment position for July, U.S. industrial production and capacity utilization for August, the United Kingdom's retail sales, Germany's producer prices and the euro area's current account balance will be monitored.
