Asia bled overnight on a Mideast oil scare and hawkish central-bank repricing, but US futures have already worked back to flat-to-up as crude fades.
The Kospi was hit hardest, down roughly 3.3% as tech led the rout, while the Nikkei closed off about 0.8% after a brutal prior session that saw chip and AI names like SoftBank and Advantest slammed on rate-hike fears. Hang Seng and CSI 300 slipped a more modest 0.3-0.7%, tech and materials underperforming. The catalyst was Saudi Arabia shutting its East-West pipeline that bypasses the Strait of Hormuz, spiking oil and reviving both Fed and BOJ tightening chatter. USD/JPY sits near 154, yen firm on carry unwind and BOJ hike expectations; USD/CNH holds a steady 7.15-7.20 handle, tracking the dollar bid.
US futures shrugged off the Asia weakness after the Energy Secretary noted Hormuz throughput actually held near 17 million barrels, knocking crude off its highs and pulling the 10-year back toward 4.79%. Dovish notes from NY Fed's Williams added a bid. That sets up a jumpy US open into FOMC: the Fed decides Wednesday, with the market split between a hold at 3.50-3.75% and a hike, and the dot plot as the real swing factor alongside August retail sales.
The risk: any fresh Hormuz disruption headline or a hawkish dot-plot surprise flips this from a controlled fade back into a genuine risk-off cascade, especially with Asia tech already fragile and yields one bad print from re-testing highs.