Asian Stocks Dragged Down by Iran War!
Asian stocks weakened on Friday, extending the sell-off in risk assets amid the protracted Middle East conflict and the latest wave of attacks from Iran. This weakness put regional markets on track for their deepest weekly decline in six years, while oil prices corrected slightly in early trading.
Japanese and Australian stocks fell, pushing the MSCI Asia Pacific Index down by about 0.5%. The index has fallen roughly 7% since the war began, reflecting a rapid shift in investor sentiment from risky to defensive assets amid uncertainty over the conflict's duration.
In global markets, US bonds were under pressure again and the dollar strengthened in the US session, putting the currency on track for its best week since 2024. US stock indexes also fell on Thursday, although they pared losses from intraday lows, underscoring the fragility of market confidence amid heightened volatility.
Energy remains a key concern. West Texas Intermediate (WTI) fell as much as 2.5% to near $79 per barrel on Friday, as the US government considered various options to curb surging oil and gasoline prices amid the war, according to officials. Despite weakening at the open, oil is still headed for its biggest weekly gain since 2022, buoyed by concerns about supply disruptions.
The US-Israeli attack on Iran has shaken global energy markets and pushed US oil to multi-year highs, primarily due to the risk of supply disruptions through the Strait of Hormuz. This uncertainty has begun to disrupt flows to key buyers, with China, the largest importer, reportedly seeking to conserve fuel, which in turn increases the risk of inflation and market volatility if the conflict continues.
Market focus next shifts to the release of US labor data, particularly the payrolls report, after preliminary data showed jobless claims hovering near a year-low amid low layoffs. The payrolls data is expected to show a slower pace of hiring compared to the previous month, with the unemployment rate stable. The market is weighing two risks: a strong figure could potentially dampen speculation about interest rate easing, but a weak figure could raise expectations of a rate cut, looming over the risk of stagflation if the energy shock persists. (asd)
Source: Newsmaker.id
