HONG KONG (AP) – Asian stock markets experienced a downturn on Thursday, with most indices closing lower as uncertainties surrounding the de-escalation of the Iran conflict persisted.
Concurrently, oil prices increased, reflecting the geopolitical tensions in the region.
U.S. futures also showed a slight decline of 0.1%, while major Asian indices experienced varying degrees of loss, highlighting investor caution amidst the ongoing crisis.
Stock Market Performance
Tokyo’s Nikkei 225 index decreased by 0.3%, settling at 53,607.75. South Korea’s Kospi fell by 1.9% to 5,537.30, while Hong Kong’s Hang Seng index dropped 1.4% to 24,978.71. The Shanghai Composite index also experienced a decline of 0.6%, closing at 3,909.16. In contrast, Australia’s S&P/ASX 200 edged down by 0.2%, whereas Taiwan’s Taiex managed a modest gain of 0.4%.
Oil Prices Rise
Oil prices surged again on Thursday, recovering from a previous dip. Brent crude, the international benchmark, rose by 1.3% to reach $98.51 per barrel, while U.S. benchmark crude increased by 1.6% to $91.75 a barrel. This rise is attributed to heightened tensions following Iran’s rejection of a U.S.-proposed ceasefire plan and its continued military actions in the region.
Geopolitical Tensions
Tehran dismissed the ceasefire plan proposed by the U.S. administration, which included a 15-point strategy aimed at de-escalating the conflict. The Iranian government has continued to launch attacks on Israel and Gulf Arab nations, prompting Israel to respond with airstrikes on Tehran. The U.S. has also indicated plans to deploy additional troops to the region, exacerbating the situation.
As the Strait of Hormuz remains a critical maritime route for global oil supply, its closure has led to significant fluctuations in oil prices, which have increased approximately 40% since the conflict’s onset four weeks ago.
U.S. Market Update
On Wednesday, U.S. stock markets closed positively, with the S&P 500 gaining 0.5% to reach 6,591.90. The Dow Jones Industrial Average rose by 0.7% to 46,429.49, and the Nasdaq composite increased by 0.8% to 21,929.83. Notably, shares of Arm Holdings surged by 16.4% following the announcement of the company’s plans to launch its own chips.
Conversely, shares of On Holding, the Swiss sportswear company, fell by 11.2% as its CEO Martin Hoffmann announced his resignation, leading to the appointment of two co-founders as co-CEOs.
Market Trends in Precious Metals and Currency
In early trading on Thursday, both gold and silver prices experienced declines. Gold fell by 0.8% to $4,513.90 per ounce, while silver dropped by 0.9% to $71.97 per ounce. Additionally, the U.S. dollar weakened slightly, trading at 159.42 Japanese yen, down from 159.47 yen, while the euro increased to $1.1570 from $1.1559.