{"id":65843,"date":"2026-08-02T21:08:16","date_gmt":"2026-08-03T01:08:16","guid":{"rendered":"https:\/\/www2.stockmarketwatch.com\/stock-market-news\/global-markets-retreat-as-yen-surges-on-joint-intervention-oil-slumps-on-u-s-iran-diplomacy\/65843\/"},"modified":"2026-08-02T21:08:16","modified_gmt":"2026-08-03T01:08:16","slug":"global-markets-retreat-as-yen-surges-on-joint-intervention-oil-slumps-on-u-s-iran-diplomacy","status":"publish","type":"post","link":"https:\/\/www2.stockmarketwatch.com\/stock-market-news\/global-markets-retreat-as-yen-surges-on-joint-intervention-oil-slumps-on-u-s-iran-diplomacy\/65843\/","title":{"rendered":"Global Markets Retreat as Yen Surges on Joint Intervention; Oil Slumps on U.S.-Iran Diplomacy"},"content":{"rendered":"<h2>Key Takeaways<\/h2>\n<ul>\n<li><strong>The Japanese Yen surged over 1% to 155.51 per dollar<\/strong> after the Ministry of Finance (MOF) confirmed a coordinated yen-buying operation with the U.S. Treasury to combat &quot;excessive volatility.&quot;<\/li>\n<li><strong>South Korea&#39;s KOSPI index plummeted over 4%<\/strong> in a sharp profit-taking reversal following a record 18% jump on July 31, as investors locked in gains from the recent AI-driven rally.<\/li>\n<li><strong>Brent <a href=\"https:\/\/stockmarketwatch.com\/energy\/crude-oil\" data-internallinksmanager029f6b8e52c=\"12\" title=\"Crude oil\">crude oil<\/a> futures for October collapsed 7.3% to $81.55 a barrel<\/strong> after U.S. President Donald Trump announced that diplomatic talks with Iran would begin Monday, potentially reopening the Strait of Hormuz.<\/li>\n<li><strong>Manufacturing activity across Asia remained resilient in July<\/strong>, with Japan\u2019s factory output growing at its fastest pace in over 12 years (PMI 54.5) and South Korea\u2019s PMI improving to 53.1.<\/li>\n<li><strong>A magnitude 5.6 earthquake struck near Sharm El-Sheikh, Egypt<\/strong>, causing tremors felt as far as Cairo, while wildfires in Eastern Washington forced the evacuation of 60,000 people.<\/li>\n<\/ul>\n<h2>Market Volatility and Currency Intervention<\/h2>\n<p>The Japanese Yen saw a dramatic strengthening on Monday, with the <strong>USD\/JPY<\/strong> pair sliding to <strong>155.51<\/strong> as markets reacted to news of rare bilateral action. The <strong>Japanese Ministry of Finance<\/strong> confirmed it conducted a yen-buying operation on July 31 in coordination with the <strong>U.S. Treasury Department<\/strong>, the first such joint effort since 2011. Finance Minister <strong>Satsuki Katayama<\/strong> stated that authorities &quot;won&#39;t hesitate to act further&quot; to correct the yen&#39;s undervaluation, which recently slipped to around 157.70 per dollar.<\/p>\n<p>Asian equities faced heavy selling pressure in the wake of the currency&#39;s rise and a cooling tech sector. <strong>MSCI&#39;s Asian equities gauge<\/strong> fell 1%, while South Korea&#39;s <strong>KOSPI<\/strong> index declined more than 4% to <strong>6,315.4<\/strong>. This retreat follows a historic <strong>18% surge<\/strong> on July 31, as investors moved to secure profits in tech heavyweights like <strong>Samsung Electronics<\/strong> (<a href=\"\/stock\/005930\">005930<\/a>) and <strong>SK Hynix<\/strong> (<a href=\"\/stock\/000660\">000660<\/a>).<\/p>\n<h2>Energy and Commodities<\/h2>\n<p>Oil prices experienced a sharp correction as geopolitical tensions in the Middle East showed signs of easing. <strong>Brent crude<\/strong> for October delivery dropped as much as <strong>7.3% to $81.55 a barrel<\/strong> after President <strong>Donald Trump<\/strong> announced that fresh U.S.-Iran talks would commence on Monday. The prospect of a deal to reopen the <strong>Strait of Hormuz<\/strong> significantly reduced the risk premium that had bolstered prices throughout July.<\/p>\n<p>Despite the drop in oil, other safe-haven assets remained in demand. <strong><a href=\"https:\/\/stockmarketwatch.com\/metal\/gold\" data-internallinksmanager029f6b8e52c=\"4\" title=\"gold price today\">Gold<\/a><\/strong> rose to approximately <strong>$4,080 an ounce<\/strong>, while <strong>U.S. Treasuries<\/strong> rallied, sending the <strong>10-year yield<\/strong> down four basis points. Market sentiment was further supported by a small <strong>OPEC+<\/strong> quota increase, though the primary driver remained the shift toward diplomacy in the Persian Gulf.<\/p>\n<h2>Regional Economic Data and Natural Disasters<\/h2>\n<p>Manufacturing data released on Monday provided a <a href=\"https:\/\/stockmarketwatch.com\/metal\/silver\" data-internallinksmanager029f6b8e52c=\"5\" title=\"silver price today\">silver<\/a> lining for regional economies. <strong>Japan&#39;s manufacturing PMI<\/strong> was finalized at <strong>54.5<\/strong> for July, slightly below the preliminary 54.7 but still reflecting the fastest output growth in over 12 years. <strong>South Korea&#39;s factory activity<\/strong> also strengthened, with its PMI rising to <strong>53.1<\/strong>, while <strong>Taiwan&#39;s S&amp;P Global manufacturing PMI<\/strong> remained in expansion territory at <strong>55.1<\/strong>.<\/p>\n<p>On the environmental front, a <strong>magnitude 5.6 earthquake<\/strong> occurred 61 km from <strong>Sharm El-Sheikh, Egypt<\/strong>, early Monday morning. While no immediate casualties were reported, the tremors were felt significantly in Cairo. Meanwhile, in the United States, devastating wildfires in <strong>Eastern Washington<\/strong> have destroyed at least <strong>600 structures<\/strong> and forced the evacuation of <strong>60,000 people<\/strong> in the Spokane area, prompting a state of emergency.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Key Takeaways The Japanese Yen surged over 1% to 155.51 per dollar after the Ministry of Finance (MOF) confirmed a 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