Markets gain across Asia, Oil pulls back after Venezuela driven surge

Asian equity markets advanced on Tuesday, taking cues from a strong overnight rally on Wall Street, while oil prices eased after an initial surge triggered by geopolitical developments involving Venezuela.

Investor sentiment across Asia was buoyed by broad-based gains in U.S. stocks, where record highs in major indices signalled confidence in economic resilience despite lingering concerns over inflation and interest rates. However, the early optimism in energy markets faded as crude prices pulled back following sharp gains a day earlier linked to the capture of Venezuelan President Nicolás Maduro by U.S. forces during a weekend operation.

In Tokyo, Japan’s Nikkei 225 rose 1.1 per cent to 52,389.63 , driven largely by strong buying in technology-related stocks. Precision tools maker Disco Corp. surged 5.3 per cent , reflecting continued appetite for semiconductor and advanced manufacturing plays. South Korea’s Kospi extended its record-breaking run, climbing 0.8 per cent to 4,495.49 , supported by gains in automakers and electronics manufacturers.

Chinese markets also participated in the rally. Hong Kong’s Hang Seng jumped 1.8 per cent to 26,815.75 , while the Shanghai Composite gained 1.1 per cent to 4,069.38 , as investors reacted positively to global risk-on sentiment following Wall Street’s performance. Taiwan’s Taiex advanced 1.2 per cent . In contrast, Australia’s S&P/ASX 200 slipped 0.4 per cent to 8,697.10 , weighed down by profit-taking in resource stocks, while India’s Sensex edged marginally lower by 0.1 per cent.

The positive tone across Asian markets followed a strong session in the U.S., where stocks rose broadly on Monday. The S&P 500 gained 0.6 per cent to 6,902.05 , hovering just below its late-December record. The Dow Jones Industrial Average set a new all-time high, climbing 1.2 per cent to 48,977.18 , while the Nasdaq Composite added 0.7 per cent to 23,395.82 . Smaller-cap stocks outperformed, with the Russell 2000 surging 1.6 per cent, signalling expanding investor confidence beyond mega-cap names.

Energy stocks were among the top performers on Wall Street after oil prices jumped on Monday amid uncertainty over Venezuela’s political future. U.S. crude rose 1.7 per cent to USD 58.32 a barrel, while Brent crude gained 1.7 per cent to USD 61.76 . Shares of Chevron jumped 5.1 per cent , Exxon Mobil rose 2.2 per cent , and Halliburton surged 7.8 per cent after U.S. President Donald Trump suggested American oil companies could play a role in rebuilding Venezuela’s battered oil industry.

However, crude prices retreated in early Asian trading on Tuesday as markets reassessed supply risks and the longer-term implications of the Venezuelan situation. U.S. crude slipped 18 cents to USD 58.14 a barrel, while Brent fell 14 cents to USD 61.62, underscoring the view that any recovery in Venezuela’s oil output would require years of heavy investment due to prolonged neglect and sanctions.

Beyond geopolitics, investors are closely watching upcoming U.S. economic data for clues on monetary policy. The Institute for Supply Management reported on Monday that U.S. manufacturing activity continued to contract in December. Attention now turns to the services sector report due Wednesday, which is closely watched as services account for the majority of U.S. economic activity.

Later in the week, labour market data, including job openings and employment figures, will be critical for expectations around Federal Reserve policy. While the Fed cut interest rates three times late in 2025, inflation remains above its 2 per cent target, prompting caution among policymakers. Markets currently expect the central bank to keep rates unchanged at its meeting later this month.

Technology stocks also remained in focus as the annual CES trade show kicked off in Las Vegas, keeping artificial intelligence firmly in the spotlight. Nvidia slipped 0.4 per cent, while Applied Materials surged 5.7 per cent . AI-driven optimism has been a key driver of global equity markets over the past year, though investors remain alert to the financial risks associated with heavy capital spending.

In currency markets, the U.S. dollar edged lower to 156.36 yen , while the euro rose to USD 1.1735. Gold gained 0.6 per cent following a sharp rise on Monday, and silver extended its rally, climbing another 2.7 per cent . Both metals have benefited from heightened geopolitical uncertainty and have reached record levels over the past year. Bitcoin retreated 1.5 per cent to USD 93,700 after touching its highest level since mid-November.