MSCI’s broadest index of Asia-Pacific shares outside Japan was down 0.22%

Asian shares wobbled on Tuesday while bonds found their footing following a sharp selloff after U.S. President Donald Trump’s paused a planned attack on Iran and his claim there was a good chance of a deal sent oil prices down.

MSCI’s broadest index of Asia-Pacific shares outside Japan was down 0.22%, while Nikkei added 1%. Kospi dropped 2%.

Brent crude futures declined more than 2% to $109.41 a barrel on the back of Trump’s comments, while U.S. crude was down 1.3% to $107.25 per barrel, though both remained more than 50% above their pre-war levels.

The decline in oil prices helped stem a steep selloff in global bonds on Tuesday, though worries remained about the lasting inflationary shock from the Iran war.

Japanese government bond yields, which shot to record highs in the previous session, were similarly down.

Still, investors remained cautious after being rattled in the previous session by a weekend attack in the United Arab Emirates.

We’ve seen a lot of back and forth already, said Fabien Yip, a market analyst at IG.

Until we actually see real action happening in the Strait of Hormuz, whereby ships are passing through safely and we see a material rebound in the numbers of traffic going through in the Strait, I think the market in general is shrugging off the commentary from either side, Yip said.

Markets are now pricing in rate hikes from some central banks this year on expectations policymakers will have to tighten policy to combat a resurgence in inflation driven by higher-for-longer energy prices.