Asian Stocks Slide as Gulf Fighting Intensifies; Iran Claims Strait of Hormuz Closed

Asian share markets fell on Monday as fighting intensified in the Gulf and Iran claimed to have closed the Strait of Hormuz, pushing oil prices higher and reviving global inflation risks, according to RTHK. In Hong Kong, the Hang Seng Index opened down 17 points, or 0.07%, at 24,157, while the tech index fell 1 point, or 0.07%, to 4,719 and the China enterprises index rose 3 points, or 0.04%, to 8,042. Mainland benchmarks also opened lower, with the Shanghai Composite down 30 points, or 0.75%, at 3,966, the Shenzhen Component down 137 points, or 0.92%, at 14,908, and the ChiNext Index down 32 points, or 0.86%, at 3,809. Japan’s Nikkei opened down 147 points, or 0.21%, at 68,410 and later fell as much as 906 points, or 1.32%, to 67,651 before lunch. South Korea’s Kospi opened down close to 64 points at 7,412 and later dropped 366 points, or 4.99%, to around 7,109 before noon. The U.S. dollar rose alongside bond yields as investors reduced the odds of a Federal Reserve rate hike ahead of chairman Kevin Warsh’s first appearance before Congress in his new role. U.S. June inflation data due Tuesday could show some easing from a headline rate of 4.2% as petrol prices decline, though the report noted some of that could reverse if oil continues to rise. Citi analysts said tech remained supported by earnings growth momentum and valuations, and maintained an overweight stance on global IT and the U.S., while also favoring cyclical exposures including Japan, financials and materials.