GLOBAL MARKETS-Asian shares climb, oil holds gains as markets eye Iran talks, central bank moves

BY Reuters | ECONOMIC | 08:54 PM EDT

* Central bankers signal inflation concerns

* Japan's Nikkei hits record after Wall Street gains on AI optimism

* New Zealand dollar subdued ahead of expected central bank rate hold

By Rocky Swift Asian shares rose while oil prices remained elevated on Wednesday as markets looked for signals that a shaky truce between the United States and Iran will be extended. Brent crude traded near $100 per barrel, and the greenback held gains from the previous session after Iran said the U.S. had violated a ceasefire. New Zealand's dollar remained lower ahead of an expected hold by the central bank. Japan's Nikkei share gauge jumped to a record level, following all-time highs on Wall Street on AI optimism as the U.S. reopened after a holiday. Sentiment remains vulnerable, however, as talks continue to reach a lasting halt to the three-month-long conflict that has rocked energy markets, and central banker comments will be watched for how the crisis is impacting the picture for inflation and interest rates.

"The markets are just waiting for something tangible now when it comes to a deal between the U.S. and Iran," Kyle Rodda, senior financial market analyst at Capital.com, wrote in a note. "A lot of good news is priced in, leaving room for disappointment if something comprehensive isn't announced."

MSCI's broadest index of Asia-Pacific shares outside Japan was up 1.2%, while the Nikkei surged 1.8%.

The dollar index, which measures the greenback against a basket of currencies, was little changed at 99.09 after a 0.15% gain in the prior session. The euro was up 0.09% at $1.1638, while the yen strengthened 0.05% to 159.19 per dollar.

Iran's foreign ministry said U.S. strikes in Iran's southern Hormozgan province represented a "gross violation" of a ceasefire. The U.S. said its attacks were defensive in nature.

U.S. Secretary of State Marco Rubio said that a deal with Tehran to halt the conflict could "take a few days," while Iran's Tasnim news agency reported that Tehran was seeking the release of $24 billion of funds frozen overseas.

U.S. crude fell 0.89% to $93.05 a barrel, and Brent fell to $99.06 per barrel, down 0.52% but following a nearly 4% surge in the prior session. The Reserve Bank of New Zealand is widely expected to hold its key rate at 2.25%. The main event in Australia on Wednesday is the release of consumer price data for April. At a meeting of central bankers in Tokyo, Bank of Japan Governor Kazuo Ueda said supply shocks were looming large. European Central Bank board member Isabel Schnabel on Tuesday advocated for an interest rate hike in June even if a U.S.-Iran peace deal is reached. Spot gold rose 0.36% to $4,522.14 an ounce, while copper rose 0.46% to $13,686.50 a metric ton.

In cryptocurrencies, bitcoin fell 0.18% to $75,883.90, and ether was little changed at $2,075.39.

(Reporting by Rocky Swift)

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