Asian stock markets displayed a mixed trend on Monday, with several major regional exchanges closed for holidays, as investors closely monitored developments in the Middle East conflict.
U.S. President Donald Trump issued a renewed threat on Sunday, stating that if Iran fails to fully reopen the Strait of Hormuz by Tuesday, the U.S. will begin striking Iranian power plants and civilian infrastructure starting Tuesday. The Strait of Hormuz is a critical global oil chokepoint; prior to the outbreak of regional conflict on February 28, approximately one-fifth of the world's oil supply transited through this waterway.
In a social media post containing harsh language, Trump vowed to make Iran "pay hell" following last week's U.S. military operation in Iran that rescued an American pilot. He subsequently posted about a deadline of "8 p.m. ET Tuesday" but provided no further details. The White House confirmed to MS NOW on Sunday that this date represents a new deadline for Iran to reach an agreement with the United States.
Trump announced he would hold a press conference "with the military" at the White House Oval Office on Monday at 1 p.m.
However, Iran rejected Trump's ultimatum to reopen the Strait of Hormuz, stating that the crucial waterway would only fully reopen after compensation for war damages is provided. Tehran continues to strike economic and infrastructure targets in neighboring Gulf states, including Kuwait's oil headquarters.
According to Axios, the United States and Iran are engaged in talks mediated by some Gulf nations regarding a potential 45-day ceasefire agreement to end the conflict, signaling progress in peace negotiations. However, the likelihood of reaching a partial agreement before Tuesday's deadline remains slim.
Homin Lin, Senior Macro Strategist at Lombard Odier, commented, "The question is whether a more favorable outcome can be achieved before another round of escalation, which would create room for de-escalation in the medium term." He added that investors would trade cautiously in response to each news development.
Lin further noted that risk assets could experience another significant downturn if Trump follows through on his promise to strike Iran's power grid and civilian infrastructure. "As long as the anxious wait regarding the final direction of the Iran situation persists, markets are likely to remain volatile."
Market Performance:
Japan's Nikkei 225 Index rose 0.55% to close at 53,413.68 points; the Topix Index was flat at 3,644.8 points. South Korea's blue-chip Kospi Index gained 1.36% to 5,450.33 points; the small-cap Kosdaq Index fell 1.5% to 1,047.37 points. As of 1:45 p.m. local time (4:15 a.m. ET), India's benchmark Nifty 50 Index was up 0.62%, reversing earlier losses; the Bombay Stock Exchange's Sensex 30 Index rose 0.68%.
Several Asian markets were closed on Monday for holidays:
Australia, New Zealand, and Hong Kong observed Easter Monday. Mainland China and Taiwan observed the Qingming Festival (Tomb-Sweeping Day).
The Organization of the Petroleum Exporting Countries (OPEC) and its eight allied nations announced on Sunday that they would increase production quotas by 206,000 barrels per day starting in May. However, this move is largely symbolic, as the conflict has already restricted oil shipments from several member countries.
As of 4:15 a.m. ET:
U.S. West Texas Intermediate (WTI) crude for May delivery fell approximately 2% to $109.3 per barrel. The international benchmark Brent crude price declined over 1% to $107.8 per barrel.
U.S. stock futures:
S&P 500 futures and Nasdaq 100 futures rose 0.22% and 0.42%, respectively. Dow Jones Industrial Average futures were essentially flat, up 0.04%.
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