Asian Stocks React to Iran-Israel Tensions and Rate Fears
Chinese Market Resilience Amidst Regional Decline
Most Asian stocks experienced a sharp decline on Monday due to escalating tensions between Iran and Israel, alongside concerns over increasing U.S. interest rates. However, Chinese stocks stood out as the sole performers of the day, bouncing back from a one-month low after Beijing pledged additional support.
Despite a weak lead from Wall Street, where major banks reported disappointing earnings, U.S. stock index futures showed a slight rise during Asian trading hours.
Performance of Asian Markets
Japan’s stock market was one of the worst performers, dropping by 1.2% as investors sought to secure profits near recent record highs. Although data indicated a rebound in capital spending through February, sentiment remained subdued ahead of March data releases.
South Korea’s market fell by 0.8% as trade data for March revealed limited growth in exports and a contraction in imports. Meanwhile, Australia’s market lost 0.5%, despite a surge in metal prices benefiting mining stocks.
Indian stock futures pointed to a negative opening following Friday’s decline from record highs, with inflation readings scheduled for later in the week.
Chinese Market Rebound Supported by Government Measures
Chinese stock indexes, including the Shanghai and Shenzhen indexes, surged by 1.8% and 1.2% respectively, recovering from recent lows. Reports of increased government support for local capital markets boosted sentiment, with state funds purchasing shares of major Chinese banks to bolster market performance.
Despite a slew of weak economic data from the previous week, Chinese markets showed resilience. However, Hong Kong’s market reflected negative sentiment towards mainland China, declining by 0.7% on Monday.
