Asian stock markets started the trading week with a largely positive tone on Monday, though investors remained on high alert, carefully assessing the escalating tensions between Israel and Iran alongside a fresh batch of economic data from China.
While the geopolitical situation fueled a jump in oil prices, most regional equity indices managed to find some upward momentum. Indian benchmarks, including the Sensex, are also in sharp focus.
The weekend saw a continuation of hostilities between Israel and Iran, with both sides exchanging strikes.
This volatile backdrop sent oil prices higher and saw gold rally as investors sought refuge in traditional safe-haven assets while global equity markets had previously slid.
Despite this, Asian markets on Monday morning appeared to be trying to look past the immediate geopolitical flare-up, at least in early trading.
Adding to the complex picture, China released several key economic data points. Retail sales in May provided a bright spot, jumping 6.4% from the previous year.
However, industrial output growth slowed to 5.8% year-on-year. Investors kept a close watch on Chinese markets as they digested these figures.
Mainland China’s CSI 300 index and Hong Kong’s Hang Seng Index were both reported to be flat in choppy early trade.
Elsewhere in the region, Japan’s benchmark Nikkei 225 climbed a solid 0.96%, while the broader Topix index advanced 0.58%.
In South Korea, the Kospi index gained 0.62%, and the small-cap Kosdaq moved up 0.36%, also experiencing some volatility.
Australia’s S&P/ASX 200 increased by 0.26%.
Indian markets on edge
Benchmark Indian stock indices, the Sensex and Nifty, are a key focus on Monday, June 16.
The geopolitical situation took a concerning turn as Iran reportedly informed mediators Oman and Qatar that it was not open to negotiating a ceasefire while under Israeli attack.
Reuters reported that Iran also stated it did not seek US involvement to broker a ceasefire.
This news contributed to Brent crude oil prices soaring above the $75 a barrel mark.
Adding to the uncertainty, US President Donald Trump suggested that the fighting may continue before any deal between Iran and Israel is reached.
Indicating a potentially positive start for Indian equities despite these headwinds, Gift Nifty was trading 51.60 points, or 0.21 percent, higher at 24,779.
US markets: futures up after Friday’s sell-off
US equity futures moved up during early Asian trading hours, suggesting some stabilization after a sharp sell-off on Wall Street last Friday.
The previous session’s decline in the US was a direct reaction to the Israel-Iran attacks, which pushed energy prices higher and added another layer of complication at a time of already heightened geopolitical uncertainty.
On Friday, the Dow Jones Industrial Average had fallen 769.83 points, or 1.79%, to end at 42,197.79. The S&P 500 dropped 1.13% to close at 5,976.97, while the Nasdaq Composite lost 1.30% to settle at 19,406.83.
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