Stocks Decline, Gold and Oil Progress on the Iran Crisis – Asia Market Wrap

Stocks fell and oil prices rose as the Middle East war rattled global markets, prompting a flight from risk assets. Haven demand drove up the price of gold and the Dollar

Asian stocks plummeted 1.5%, and S&P 500 Index futures tumbled nearly 1%. Markets were turbulent as conflicting rumours emerged about Iran-US talks. Treasuries fell from gains to losses after the Wall Street Journal reported that Iran made a new effort to reopen nuclear talks with the US. Iran’s national security leader, Ali Larijani, has vowed the country will not talk.

Some of the steepest swings in oil have moderated, after an initial knee-jerk reaction saw Brent soar by up to 13%. The commodity reduced some of its gains to trade at $77.53 per barrel, up 6.4%. Traders were focused on the state of the Strait of Hormuz, which is now virtually closed, as the waterway is critical for the flow of oil to the rest of the world.

Shaken by new concerns about AI and potential credit breaches, all while trading at record high valuations, stock markets must now deal with spiralling military activity in Iran and the wider region, which threatens to destabilise global trade and impede travel. The impact on oil and inflation is a major concern in markets, which saw US stocks fall to their lowest level since April last month.

Stocks fell on Monday after global markets surged in December and February. Asian stocks have outperformed US and European indices, as concerns about AI spending and the technology’s negative impact on industries have roiled markets.