Asia‑Pacific Markets Slide as Trump’s Defense Crackdown and Oil Price Shift Shake Investor Confidence

Asia‑Pacific markets mostly declined on Thursday as investors reacted to renewed geopolitical tensions and policy shifts from the United States that rippled through global financial markets. Wall Street closed lower overnight, adding pressure on Asian stocks, with key indices such as Japan’s Nikkei 225 and Hong Kong’s Hang Seng seeing notable sell‑offs. The downturn reflected mounting unease among traders about future earnings and broader economic direction.

U.S. President Donald Trump drew sharp market focus after announcing that major defense firms would be barred from issuing dividends or conducting share buybacks until outstanding concerns — including executive pay and production challenges — were addressed. This direct intervention rattled defense stocks and ignited broader uncertainty in equity markets, prompting risk‑off trading in Asia.

Oil prices also factored heavily into market sentiment as Trump revealed that Venezuela’s interim authorities might deliver up to 50 million barrels of crude to the United States. While this raised expectations of increased supply, it also led to overnight declines in key benchmarks such as Brent crude, adding to investor caution.

Regionally, Japan’s benchmark Nikkei index retreated amid losses in major technology and materials stocks, with household names like SoftBank and Tokyo Electron posting significant drops. In contrast, South Korea’s Kospi showed slight gains, and Australia’s S&P/ASX 200 edged higher in a mixed performance that underscored divergent investor strategies across markets.

Elsewhere in Asia, Hong Kong’s Hang Seng Index slipped as technology and materials sectors fell, while India’s major indices — including the Nifty 50 and BSE Sensex — finished lower. Amid the broader sell‑off, one standout story emerged with the strong debut of an AI‑focused Hong Kong IPO, highlighting pockets of growth even in a cautious trading environment.

source: cnbc