A renewed slump
in oil prices to seven-month lows put Asian investors on edge on
Wednesday, overshadowing a decision by U.S. index provider MSCI to add
mainland Chinese stocks to one of its popular benchmarks.
The
slide in energy costs boosted bond prices and flattened yield curves as
investors priced in lower inflation for longer, while safe-haven flows
underpinned the U.S. dollar.
The spread between yields on U.S. five-year notes and 30-year bonds shrank to the smallest since 2007 as investors wagered the Federal Reserve might have to delay further rate hikes.
MSCI's broadest index of Asia-Pacific shares outside Japan slipped 0.8 percent, with Australia's commodity-heavy market down 1.5 percent. Japan's Nikkei eased 0.45 percent.
In Europe, futures for the Eurostoxx 50, DAX and FTSE were all off 0.3 percent.
Oil had shed 2 percent on Tuesday as increased supply from several key producers overshadowed high compliance by OPEC and non-OPEC producers on a deal to cut global output.
The drop took U.S. crude down 20 percent from its recent high and thus into official bear territory, a red flag to investors who follow technical trends.
On Wednesday, Brent eased 10 cents to $45.92 a barrel, while U.S. crude futures lost 6 cents to $43.45.
Adding to the uncertainty was news Saudi Arabia's Crown Prince Mohammed bin Salman had replaced his cousin in a sudden shift that made King Salman's 31-year-old son next ruler of the kingdom.
The hit to energy stocks saw the Dow end Tuesday down 0.29 percent, while the S&P 500 eased 0.67 percent and the Nasdaq 0.82 percent. E-Mini futures for the S&P 500 were 0.1 percent lower on Wednesday.
The spread between yields on U.S. five-year notes and 30-year bonds shrank to the smallest since 2007 as investors wagered the Federal Reserve might have to delay further rate hikes.
MSCI's broadest index of Asia-Pacific shares outside Japan slipped 0.8 percent, with Australia's commodity-heavy market down 1.5 percent. Japan's Nikkei eased 0.45 percent.
In Europe, futures for the Eurostoxx 50, DAX and FTSE were all off 0.3 percent.
Oil had shed 2 percent on Tuesday as increased supply from several key producers overshadowed high compliance by OPEC and non-OPEC producers on a deal to cut global output.
The drop took U.S. crude down 20 percent from its recent high and thus into official bear territory, a red flag to investors who follow technical trends.
On Wednesday, Brent eased 10 cents to $45.92 a barrel, while U.S. crude futures lost 6 cents to $43.45.
Adding to the uncertainty was news Saudi Arabia's Crown Prince Mohammed bin Salman had replaced his cousin in a sudden shift that made King Salman's 31-year-old son next ruler of the kingdom.
The hit to energy stocks saw the Dow end Tuesday down 0.29 percent, while the S&P 500 eased 0.67 percent and the Nasdaq 0.82 percent. E-Mini futures for the S&P 500 were 0.1 percent lower on Wednesday.
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