Asian shares edge higher as oil eases and earnings season looms

Asian shares edged higher as Brent crude slipped to about $71.70 a barrel, near a four-month low, and U.S. crude fell to $68.38. The softer oil backdrop helped Wall Street futures rise and eased some of the inflation pressure on U.S. households, retirement accounts and the Federal Reserve’s next move.

The latest pullback in oil came as OPEC+ agreed to raise output targets by 188,000 barrels per day from August, after similar increases for June and July. There were no new developments in U.S.-Iran peace talks, but the Strait of Hormuz remained active, with 160 vessels passing through the waterway from Monday through Saturday of the prior week. With that route carrying a large share of global energy shipments, traders treated the steady traffic and the extra supply from OPEC+ as enough to keep crude pinned near its recent lows.

A softer-than-expected U.S. payrolls report also lowered the pressure for an immediate Federal Reserve move. Interest-rate futures implied a 78% chance that the Fed would leave rates unchanged at its July 29 meeting, and minutes due Wednesday were next on the calendar. Richard Yetsenga of ANZ said that even if there had been a risk of the Fed moving soon, “markets were likely safe for at least another month.”

Delta Air Lines and PepsiCo were among the early big U.S. names scheduled to report, and Samsung Electronics was the focal point in Asia. Samsung Electronics was expected to post second-quarter operating profit of about 86 trillion won, or $56.35 billion, roughly 18 times the year-earlier figure and its biggest quarterly operating profit in more than three years.

The KOSPI had touched an all-time high in June before a volatile early-July pullback and rebound. U.S. futures pointed higher, especially for the Nasdaq, while European futures were mixed as investors waited for earnings.