Public Markets 8-Hour Briefing
×Market Turmoil
Asian stocks extended declines into a second day as mounting conflict in the Middle East intensified risk-off sentiment among investors. South Korean stocks slumped their worst selloff since 2024 on Iran war risks, while Asian government bonds sold off amid fears the conflict will drive inflation and faster interest-rate increases.
Oil & Energy
Oil prices rose in the morning Asian session as the ongoing Middle East conflict kept supply disruption risks elevated. Coal prices jumped the most in three years as an unprecedented shutdown of Qatar's liquefied natural gas plant raised the needs for fuel-switching in the electricity sector. Aluminum edged up after President Donald Trump suggested the military campaign against Iran could last weeks, raising the risk of deeper disruptions to exports of the metal from the Middle East.
Gold & Safe Havens
Gold could reach a record high above $5,600/oz this week if signs of de-escalation in the Middle East don't emerge, according to BMI, a unit of Fitch Solutions. The Iran war is rekindling inflation concerns across financial markets, sapping the outlook for global bonds that had just posted their best start to a year since the pandemic.
Asian Currencies & Markets
The yuan rallied after the People's Bank of China signaled its comfort with the currency's appreciation via its daily reference rate, ahead of the National People's Congress. Asian FX was mixed amid Iran conflict worries, with South Korean won and Indian rupee topping losers. Turkey's central bank is set to hit the pause button on interest-rate cuts in March as a spike in energy costs amid the conflict in Iran threatens the country's disinflation efforts, according to traders.
Corporate & Economic Impact
Goldman Sachs gauges oil price impact on Asian earnings, with Timothy Moe saying a spike in oil prices due to the Iran conflict could impact corporate earnings in Asia. Malaysian energy giant Petroliam Nasional Bhd. said it is closely monitoring the conflict in the Middle East even though it has seen no direct impact on its operations so far. Philippine President Ferdinand Marcos Jr. plans to seek emergency power to slash taxes on petroleum products amid the war in the Middle East.
Regional Developments
Singapore is cranking up efforts to turn itself into a regional gold hub, tapping local and international banks including JPMorgan Chase & Co. and UBS Group AG to help boost liquidity. Japan Post Insurance Co. plans to sell holdings of lower-yielding government bonds and replace them with higher-yielding debt on expectations for further interest-rate hikes. One of Taiwan's largest pension funds is considering tapping asset managers to help it invest in markets abroad, less than a year after it last gave such mandates.
Market Analysis
Howard Marks said investors need to avoid letting their emotions run high when making decisions on exposure due to the Middle East conflict. Danny Moses, founder of Moses Ventures, discussed the state of US markets as the Iran conflict introduces a new set of headwinds. Limited oil price surges signal that traders are betting on a short conflict, but a lengthy disruption threatens to cause chaos across markets.