Asia-Pacific Markets Waver Amid U.S. Strikes on Iran

Picture Credit: Financial Times

Asia-Pacific markets declined on Monday, reeling from heightened tensions in the Middle East after the United States launched strikes on three Iranian nuclear sites. The move briefly pushed oil prices higher and rattled investor sentiment across the region.

Japan’s Nikkei 225 closed down 0.13%, while South Korea’s Kospi dipped 0.24%, later extending losses to over 1% as tech and auto stocks tumbled. Meanwhile, Hong Kong’s Hang Seng Index bucked the trend, climbing 0.67% led by gains in real estate and tech stocks. Australia’s ASX 200 fell 0.36%, and India’s Sensex dropped 0.44%.

Brent crude rose as high as $81.40 before settling at $79.08, while WTI climbed 2.74% to $75.85. In currency markets, the Japanese yen weakened 0.31%, and most regional currencies depreciated against the dollar as traders braced for potential escalation and supply disruptions near the Strait of Hormuz.

Tech stocks declined in Japan, with Screen Holdings and Lasertec falling sharply. Auto stocks also sank, with Hyundai and Kia each losing over 4%, and Nissan and Mazda down more than 2%.

Travel-related shares in Asia took a hit as well, including Japan Airlines, ANA, Qantas, and Air China, driven by concerns over surging oil prices and geopolitical risks impacting air travel.

Investors remain cautious amid ongoing Middle East tensions and questions over future U.S. Fed rate policy. The shifting dynamics may lead to capital flow realignments and further volatility in global markets.