The decline in oil prices and bond yields increased risk appetite in global markets. Expectations that lower energy costs could limit inflationary pressures supported positive sentiment across many markets, particularly in the United States.
Analysts said the Federal Reserve could approach its inflation target more easily if energy prices did not rise. The continued strength of the US economy also helped make tight monetary policy more manageable.
The price of November Brent crude fell 1.3% to trade at $103.4. While concerns continued over clashes between Saudi Arabia and the Houthis in Yemen, expectations that alternative routes could be found for oil shipments from the Middle East contributed to the decline in prices.
US 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.
US markets rise
The US 10-year Treasury yield 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 Dow Jones index rose 0.61%, the S&P 500 gained 1.14% and the Nasdaq increased 1.69%. The average price of diesel in the United States reached approximately $6.40 per gallon, setting a new record.
The number of people filing initial jobless claims fell to 196,000 in the week ended September 12, below market expectations. US index futures also started the new day on a positive note.
European stocks advance
European stocks rose on expectations that geopolitical tensions could ease and amid the impact of falling oil prices. Gains in the shares of automotive, telecommunications and retail companies supported regional markets.
The Bank of England kept its policy rate at 3.75%, in line with expectations. The decision was taken with six members voting to keep 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 announced that 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 conflicts in the Middle East continued for a long time and second-round effects increased. Consumer prices in the euro area rose 0.4% month-on-month and 3.2% year-on-year in August.
The FTSE 100 in the United Kingdom gained 1.19%, France's CAC 40 rose 0.57%, Italy's FTSE MIB increased 0.80% and Germany's DAX advanced 0.77%. European index futures started the day mixed.
BoJ decision watched in Asian markets
Asian stocks rose on falling 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, adding that rate hikes could continue depending on economic activity and financial conditions.
The fact that the rate hike was not unanimous increased 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 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 increased 0.7% and the Shanghai Composite advanced 1%.
Borsa Istanbul 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-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 monitored closely 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 their own shares repurchased after September 16 as a deduction item from core capital until December 31. Those shares will also be excluded from calculations of risk-weighted assets for credit and market risk.
Analysts said 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, the United States' industrial production and capacity utilization rates for August, the United Kingdom's retail sales, Germany's producer prices and the euro area's current account balance will be monitored.
