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Crude oil hovers near multi-week lows as supply worries

recede

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U.S. stock futures flat after rally on Wall Street

overnight

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Two-year Treasury yields fall to fresh multi-week low

By Kevin Buckland

TOKYO, June 25 (Reuters) - Asian stocks ticked higher

and crude oil wallowed near multi-week lows on Wednesday, as

investors took a ceasefire between Israel and Iran as a green

light to head back into riskier assets and cast aside immediate

worries about an energy shock.

The dollar languished close to an almost four-year low

versus the euro with two-year U.S. Treasury yields sagging to

1-1/2-month troughs as lower oil prices reduced the risk to

bonds from an inflation spike.

The shaky truce has so far held, although Israel says it

will respond forcefully to Iranian missile strikes that came

after U.S. President Donald Trump announced an end to the

hostilities.

In addition, U.S. airstrikes did not destroy Iran's nuclear

capability and only set it back by a few months, according to a

preliminary U.S. intelligence assessment, contradicting Trump's

earlier comments that Iran's nuclear programme had been

"obliterated".

Japan's Nikkei rose 0.3% and Australia's stock

benchmark edged up 0.1%, while Taiwan's index

gained 0.9%. Hong Kong's Hang Seng climbed 0.8% and

mainland Chinese blue chips added 0.5%.

An MSCI index of global stocks held steady

after pushing to a record high overnight.

"Despite the cease fire between Israel and Iran appearing

somewhat tenuous, the markets are shrugging it off," said Kyle

Rodda, senior financial markets analyst at Capital.com.

"Realistically, the markets don't care if a limited conflict

comprised of mostly air strikes continues between the two

countries," he said. "It's the prospect of a broader war, with

deeper U.S. intervention and an Iranian blockade of the Strait

of Hormuz that really matters. And for now, the risks of that

seem low."

U.S. stock futures pointed slightly higher after the

S&P 500 jumped more than 1% overnight. Pan-European STOXX

50 futures advanced 0.2%.

Brent crude ticked up 83 cents to $67.97 per barrel,

bouncing a bit following a plunge of as much as $14.58 over the

previous two sessions. U.S. West Texas Intermediate crude

also added 83 cents to trade at $65.20 per barrel.

The two-year U.S. Treasury yield dipped to the

lowest since May 8 at 3.787%.

The U.S. dollar index, which measures the currency

against six major counterparts, was flat at 97.977.

The euro added 0.1% to $1.1612, edging back

towards the overnight high of $1.1641, a level not seen since

October 2021.

Gold rose 0.3% to about $3,333 per ounce.

Aside from geopolitics, U.S. monetary policy continues to

dominate investor concerns.

Federal Reserve Chair Jerome Powell said on Tuesday that

higher tariffs could begin raising inflation this summer, a

period that will be key to the U.S. central bank considering

possible interest rate cuts.

Data showed that U.S. consumer confidence unexpectedly

deteriorated in June, signalling softening labour market

conditions.

Markets continue to price in a roughly 19% chance that the

Fed will cut rates by a quarter point in July, according to the

CME FedWatch tool.