Asian markets that were open for trading on Monday mostly posted gains, as investors remained vigilant over the escalating war in Iran, surging oil prices, and potential geopolitical developments from former President Donald Trump. The trading session saw notable increases in key indices, reflecting a cautious yet optimistic sentiment amid ongoing uncertainties.
Market Performance and Closures
Japan's benchmark Nikkei 225 rose nearly 1.1% to 53,692.42 during morning trading, while South Korea's Kospi gained 1.5% to 5,460.24. However, trading was suspended in Australia due to the Easter holiday, and in Hong Kong and Shanghai for a traditional Chinese holiday, limiting broader market activity.
Geopolitical Tensions and Oil Price Surge
The looming Tuesday deadline set by Trump for Iran to open the Strait of Hormuz has heightened fears of further escalation in the conflict. Over the weekend, Trump issued additional threats against Iran, even as bombing continued in the region. In a related incident, the United States successfully rescued two aviators whose fighter jet was shot down by Iranian forces.
Oil prices remained a central focus for markets, with benchmark U.S. crude increasing by 38 cents to $111.92 a barrel and Brent crude, the international standard, adding $1.71 to $110.74 a barrel. Although energy markets were closed on Friday, prices have been climbing steadily due to concerns that the Iran war may persist longer than anticipated.
While the U.S. imports only a small fraction of its oil from the Persian Gulf, oil is a globally traded commodity, and price fluctuations impact nations worldwide. For instance, resource-poor countries like Japan rely heavily on imports and access to the Strait of Hormuz for a significant portion of their energy needs.
Analyst Insights and Market Sentiment
Jay Woods, an analyst at Freedom Capital Markets in New York, commented on the prevailing uncertainty: "As we kick off the first full trading week of April, the word uncertainty is paramount. Last year it was centered on the impact of 'Liberation Day' tariffs, this year it's uncertainty surrounding the ongoing Iranian War." This sentiment underscores how geopolitical events are shaping investor behavior and market dynamics.
In the United States, markets were closed for Good Friday and were set to reopen on Monday, with some European markets also observing closures on Friday, adding to the subdued global trading volume.
Currency Movements
In currency trading, the U.S. dollar edged up slightly to 159.65 Japanese yen on Monday from 159.63, while the euro declined to $1.1509 from $1.1517. These minor shifts reflect the cautious stance in forex markets amid the broader economic and political backdrop.
This report includes contributions from AP Business Writer Matt Ott in Washington. Yuri Kageyama, the author, is active on social media platforms such as Threads.
