Sharp losses across Asia come as shipping disruptions in a key oil route intensify global risk concerns, with experts warning of deeper financial stress ahead.
(Photo: ANI)
Asian markets opened to heavy selling on Monday, with sharp losses across key indices as investors reacted to rising oil prices and growing tensions in West Asia.
The pressure comes as the conflict involving the United States, Israel and Iran stretches into its second month, with no clear sign of a breakthrough or slowdown, keeping global markets on edge. Disruptions to energy supplies and fears over inflation are now feeding into global market nerves.
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Japan’s Nikkei 225 dropped close to 5 per cent to around 50,950, while South Korea’s KOSPI slipped about 4 per cent to near 5,240. Other regional markets also remained under pressure. Hong Kong’s Hang Seng fell 1.69 per cent to 24,533, Taiwan’s Weighted index lost 1.86 per cent to 32,488, and Singapore’s Straits Times index edged down 0.26 per cent to 4,885.
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The slide comes as oil prices have shot up, with Brent crude touching USD 115.61 a barrel, a level that is now worrying markets about higher costs, rising inflation and pressure on economies.
The West Asia conflict, which started on February 28, is now hitting energy supply lines. Attacks on infrastructure and Iran’s hold over the Strait of Hormuz have made things worse, with many shipping companies stopping transit through the key route, tightening global supply further.
Market experts caution that the current situation could trigger wider financial stress. Banking and market expert Ajay Bagga told news agency ANI, “There are three brewing crises in the financial world right now. We don’t understand the scale or interaction of these. It could be ‘2007 leading to a full blown 2008’ along with a Dot Com Crash 2.0 thrown in for good measure.”
“Massive private credit exposure, with retail investors in the dock as well, multiple funds suspending redemptions at the same time. The largest energy disruption in human history, with no off ramp in sight,” he added,
Bagga also pointed to growing pressure on bond markets, which are struggling to assess risks amid record levels of debt, rising deficits, persistent inflation and slowing growth. He said central bank measures are proving less effective in managing the situation.
The United Nations has also flagged concerns over the wider global fallout. In a statement shared by spokesperson Stephane Dujarric, UN Secretary-General Antonio Guterres announced the creation of a task force to deal with disruptions in maritime traffic through the Strait of Hormuz.
The UN warned that prolonged disruption along this key shipping route could affect global supply chains, including essential humanitarian aid and agricultural flows.
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