Stocks Fall on Increased Tensions with Iran & Dollar Gains – Asia Market Wrap
Stocks fell from record highs, while the Dollar rose as the US and Iran traded fire, heightening Middle Eastern tensions and fuelling inflation fears.
The MSCI Asia Pacific Index for equities slipped 0.5% from its all-time high on Monday, amid speculation that the Iran war may escalate. Trading was light because Japan, China, and South Korea were all off for holidays. Earlier, Wall Street indices slipped lower from their highs, following a crude oil surge that saw global benchmark Brent rise above $115 per barrel.
Oil prices fell during the Asian session, which provided some respite. Brent slipped 0.9% to roughly $113.50 per barrel, trimming Monday’s 5.8% increase. This boosted US equity-index futures by 0.2%, but those for European stocks showed a flat open. The Dollar, which has served as a safe haven during the Middle East war, has strengthened versus all of its Group of 10 counterparts.
Meanwhile, the Australian Dollar recovered from previous losses as the RBA lifted interest rates, as most economists expected.
Elsewhere, gold crept higher to around $4,550 per ounce on hints that dip buyers had entered the market after a flare-up in hostilities in the Middle East knocked prices down by 2% on Monday.
