Equity markets across the Asia-Pacific region retreated on Monday as traders responded to increased geopolitical risks following remarks from the U.S. President Donald Trump urging Iran to act swiftly. Concerns over further instability in the Middle East and possible interruptions to energy supplies weighed on investor sentiment.
Japanese benchmarks saw mixed movement, with the Nikkei 225 easing 1.2%, while in South Korea, the Kospi rose 0.75%. The Australian ASX 200 fell 1.27%. In addition, Shanghai Composite gained 0.08% and the Hang Seng Index dropped 1.46%.
Crude oil prices climbed on Monday after President Donald Trump cautioned Iran to act swiftly amid a continuing stalemate over peace negotiations. Analysts noted that oil inventories have reached historic lows as supply disruptions persist.
On the commodities markets, July Brent crude contracts rose by 2.03% to settle at $111.56 per barrel. U.S. West Texas Intermediate contracts for June delivery advanced 2.55%, reaching $108.11 per barrel and marking their highest level for the month.
President Trump, addressing the standoff with Tehran, posted on Truth Social over the weekend that Iran faced a shrinking window of opportunity, suggesting severe consequences if negotiations remain stalled. The message followed a period of heightened tension, with talks over the reopening of the Strait of Hormuz at an impasse and concern increasing about potential renewed military conflict.
On the commodities front, gold prices posted significant losses, touching their lowest point in over a week on Friday. The retreat in bullion came as U.S. Treasury yields and the dollar both advanced, and persistent inflation concerns stemming from Middle East unrest encouraged expectations for prolonged higher interest rates.
On Monday, in spot trading, gold slipped 0.66% to $4,532 per ounce. Meanwhile, U.S. gold futures for June delivery fell 0.53% to settle at $4,537.59.
