Singapore - Financial markets got off to a volatile start in Asia on March 23, with major share indexes in Japan and South Korea plunging more than 5 per cent as investors fled risk assets amid escalating conflict in the Middle East that has entered its fourth week.
US President Donald Trump issuing a 48-hour ultimatum to Tehran to reopen the Strait of Hormuz or face strikes on its power plants, a deadline that expires on the evening of March 23 in New York.
Iran responded that any such attack would prompt it to shut the vital artery for global energy flows indefinitely and target US and Israeli energy infrastructure across the region.
As at 10am Singapore time, Japan’s Nikkei index lost 3.4 per cent, South Korea’s Kospi index plunged 4.6 per cent, Hong Kong’s Hang Seng Index tumbled 2.5 per cent while Shanghai Composite Index fell 1.7 per cent at the open.
Singapore’s Straits Times Index was down 1.7 per cent.
Brent crude oil swung sharply, jumping 1.9 per cent initially before reversing to fall nearly 1.8 per cent.
Brent was down 0.1 per cent at $112.08 at 10am Singapore time.
Gold prices slipped more than 3 per cent, extending their drop to a roughly four-month low, as the escalating Middle East conflict stoked inflation concerns and expectations of higher global interest rates.
Gold generates no interest so when central banks raise interest rates, investors tend to sell gold to invest in interest-yielding assets like bonds or savings accounts.
Additionally, higher rates often strengthen the US dollar, making gold costlier for foreign buyers.
“Pulling back on this war....
