(Bloomberg) — Asian stocks fell on Monday as U.S. stocks fell as markets grappled with creeping tensions following Iran's unprecedented attack on Israel over the weekend.
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Stock benchmarks in Japan, South Korea and Australia all fell, and Hong Kong stock futures also fell. U.S. stock deals edged higher in Asian markets on Friday as the S&P 500 index suffered its worst trading since January amid a flight to safety.
Investors are already spooked by persistently high inflation and the prospect of rising long-term interest rates, and an escalating crisis in the Middle East risks injecting fresh volatility into markets. As the conflict escalates, many say oil could soar above $100 a barrel, expecting a flight to U.S. Treasuries, gold and the dollar and further stock market losses.
Most of the 10 major currencies rose against the dollar on Monday, but Treasure was firm in early Asian trading after yields fell in the previous session. Gold rose on rising demand for safe-haven assets, while aluminum rose more than 6% following U.S. sanctions on Russian trade.
“The escalation of tensions over the weekend has unfortunately created another bitter uncertainty for the financial community to digest,” said Hebe Chen, an analyst at IG Markets. In Asia, “financial and high-tech sectors are likely to experience the most severe pain. Rising energy prices are likely to cast a shadow on the inflation trajectory, resulting in interest rates rising for an extended period of time.” Dew.”
In Asia, Chinese stocks are set for a tough week after Friday's disappointing Chinese trade data. Even if the global risk mood improves and tensions in the Middle East subside, there could be headwinds for Chinese stocks to overcome.
Developer China Vanke also faces liquidity pressures and short-term operational difficulties as China's top leaders grow wary of the protracted real estate crisis and its impact on the struggling economy. He said he is making plans to resolve the issue.
war nerves
Iran said “the issue is considered resolved,” but traders are now trying to determine whether the conflict will escalate into a wider regional war. Still, nerves may be eased following reports that President Joe Biden told Israeli Prime Minister Benjamin Netanyahu that the United States would not support Israel's counterattack against Iran.
“There could be an eventual fade out for the market as Iran and Israel pull back from the brink,” said Namik Immerbeck, chief strategist at Scandinaviska Enskilda Banken AB. “But in the short term, it will lead to trend-driven position reductions, especially following quantitative strategies,” he said, exacerbating the typical flight to safety.
Read more: Iran's attack on Israel intensifies race to avoid all-out war
Bitcoin has rebounded after falling nearly 9% following Saturday's attack. Stock markets in Saudi Arabia and Qatar recorded modest declines on Sunday amid thin trading volumes. The Israeli stock benchmark fluctuated between gains and losses at least nine times before closing with slight gains.
Oil has repelled an Iranian attack, but gains were capped by expectations that the conflict would remain contained. Brent crude oil has already risen about 20% this year and was last trading around $90 a barrel.
Traders will soon turn their attention to looming economic data as they narrow down their expectations for central bank easing cycles and the International Monetary Fund and World Bank's spring meetings in Washington. This week, growth figures for China and inflation rates for Japan, the euro area and the UK are expected to be released.
This week's main events:
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Eurozone industrial production, Monday
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US Retail Sales, Imperial Manufacturing, Corporate Inventories, Monday
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Federal income tax paid on Monday in the United States
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The spring meetings of the IMF and World Bank begin in Washington on Monday.Major ministerial meetings will be held from April 17th to 19th
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Canadian Consumer Price Index, Tuesday
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China real estate prices, retail sales, industrial production, GDP, Tuesday
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UK unemployment insurance claims, unemployment rate, Tuesday
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New Zealand Home Sales, CPI, Wednesday
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Eurozone CPI, Wednesday
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UK CPI, Wednesday
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Australian unemployment rate Thursday
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Japan CPI, Friday
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Indian elections begin on Friday
The main movements in the market are:
stock
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As of 9:20 a.m. Tokyo time, S&P 500 futures were up 0.1%.
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Hang Seng futures fell 1.7%.
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Japan's TOPIX fell 1.4%
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Australia's S&P/ASX 200 falls 0.6%
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Euro Stoxx50 futures fall 0.3%
currency
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Bloomberg Dollar Spot Index little changed
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The euro was almost unchanged at $1.0645.
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The Japanese yen was almost unchanged at 153.31 to the dollar.
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The offshore yuan was almost unchanged at 7.2658 yuan to the dollar.
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The Australian dollar was almost unchanged at US$0.6472.
cryptocurrency
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Bitcoin rises 2.7% to $65,587.35
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Ether rose 2.2% to $3,136.3
bond
merchandise
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West Texas Intermediate crude oil fell 0.1% to $85.54 a barrel.
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Spot gold rose 0.7% to $2,360.82 an ounce.
This article was produced in partnership with Bloomberg Automation.
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