Asia-Pacific markets experienced sharp losses on Thursday, reversing earlier gains, as oil prices surged following a high-stakes address from U.S. President Donald Trump on the Iran conflict. Major indexes across Tokyo, Hong Kong, and Seoul closed in negative territory, reflecting investor concerns over rising geopolitical tensions in the Middle East.
During his 19-minute national address, Trump said U.S. objectives in Iran were “almost met” and insisted that Washington “has all the cards” in the ongoing conflict. He warned that the U.S. would strike Iran “very hard” in the next two to three weeks, signaling a potential escalation that rattled global markets.
Trump also claimed that Iran’s “New Regime President” had requested a ceasefire, a statement Tehran denied. The president added that the U.S. would only consider negotiations once the Strait of Hormuz was “open, free, and clear,” further fueling uncertainty in energy and stock markets. Following the speech, oil prices jumped sharply, with U.S. crude rising 6% to $106.39 per barrel and Brent crude climbing 6.7% to $107.97.
Stock markets reacted strongly to the address. South Korea’s Kospi fell 4.47% to 5,234.05, leading regional losses, while Japan’s Nikkei 225 dropped 2.38% to close at 52,463.27. Hong Kong’s Hang Seng slipped 0.7%, Australia’s S&P/ASX 200 fell 1.06%, and China’s CSI 300 lost 1.04%. In India, the Nifty 50 and Sensex both opened lower, down 1.38% and 1.47%, respectively.
Analysts say the market reaction reflects skepticism about Trump’s statements. “Markets reacted negatively because, while Trump says it is nearly over, he is sending the third aircraft carrier and more troops to the region, so it is hard to believe his words,” said Alicia Garcia Herrero, chief economist for Asia Pacific at Natixis. U.S. stock futures also declined, signaling potential spillover effects when markets reopen across the Pacific.
source: cnbc