Crude Oil Drops to $109.66 as Asian Markets Split on AI Spending

Energy costs eased for consumers and industries this week as global oil prices declined. Brent crude, the international benchmark, fell 3.3% to $109.66 per barrel in early Monday trading. The U.S. benchmark price also dropped 3.3%, reaching $100.64 per barrel. This price action follows a volatile week in which investors reassessed the value of technology stocks.

Asian equity markets moved in opposite directions on Monday. South Korea’s Kospi index climbed 2.3% to finish at 5,859.83. The rise was fueled by gains in major tech firms, with Samsung Electronics up 1.7% and memory chipmaker SK Hynix surging 4.2%. In contrast, Japan’s Nikkei 225 index slipped 0.1% to 63,218.02. The Japanese index gave up early gains after SoftBank Group shares dropped 1.8% and Kioxia Holdings fell approximately 14% on disappointing earnings forecasts.

Market sentiment was influenced by reports that Chinese factory activity returned to contraction in October. Despite this economic slowdown, the Shanghai Composite index rose 1.2% to 3,640.93. Chinese media reported that the country’s central bank and securities regulator met with financial institutions on Monday to discuss support for the capital market. In other regions, the Hang Seng index in Hong Kong gained 0.6% to 23,437.41, while Australia’s S&P/ASX 200 lost 0.6% to 8,851.40. India’s Sensex rose 1.1%.

Investors remain focused on the sustainability of artificial intelligence spending. U.S. futures edged higher on Monday after Wall Street posted its worst day since June on Friday. The S&P 500 dropped 1.8% that day, while the Nasdaq composite fell 2.9%. Apple is scheduled to release its latest earnings later on Monday. Last week, reports from Alphabet Inc. and Amazon raised concerns about the speed at which their massive AI investments will generate profits. Over the past month, the Nikkei 225 has fallen more than 6% and the Kospi has dropped more than 16%.

Diplomatic developments in the Middle East also affected market mood. Iran’s top diplomat stated in a weekend interview on his Telegram channel that Iranian negotiators were in Qatar discussing a proposal to reopen the Strait of Hormuz. He said the reopening could occur within two days if the United States meets several conditions, though no direct talks were currently being held. The final outcome depends on responses from the U.S. to Iranian questions. In currency markets, the U.S. dollar strengthened to 157.91 Japanese yen, up from 157.49 yen, and the euro rose to $1.1172.