(Sharecast News) - Asia-Pacific markets mostly rose on Monday as investors monitored escalating tensions between the US and Iran, with a sharp jump in oil prices underscoring concerns over potential supply disruptions.
As Patrick Munnelly, market strategy partner at TickMill, noted, "Risk sentiment deteriorated at the start of the week as renewed US-Iran tensions prompted a defensive market response, undermining expectations of near-term de-escalation in the Middle East."
Sentiment remained cautious after US president Donald Trump said a US Navy guided missile destroyer had fired on and disabled an Iranian-flagged cargo ship in the Gulf of Oman before Marines boarded and seized the vessel.
The move marked an escalation of the blockade, following reports that Iran had fired on commercial vessels attempting to transit the Strait of Hormuz earlier in the day.
Trump also warned he would "knock out every single Power Plant, and every single Bridge, in Iran" if Tehran did not agree to Washington's terms.
Munnelly added that the escalation included "Iranian fire on ships and renewed assertions of control over the Strait of Hormuz, a critical artery for global energy flows."
Oil prices surged on fears that the conflict could disrupt key shipping routes, with Brent crude futures last up 6.06% on ICE at $95.86 a barrel, and the NYMEX quote for West Texas Intermediate climbing 6.92% to $89.65.
"Crude led the move ... after reports that the US Navy intercepted an Iranian vessel over the weekend," Munnelly said, while noting that "European natural gas prices jumped as much as 11% after Tehran said over the weekend that it had again shut the strategic waterway."
Bourses rise across Asia
In Japan, the Nikkei 225 rose 0.6% to 58,824.89, with gains led by Renesas Electronics, up 6.35%, Chugai Pharmaceutical, which added 5.93%, and SoftBank Group, up 5.46%.
The broader Topix index gained 0.43% to 3,777.02.
Munnelly noted that "in Asia, equities in Taiwan, Singapore, and China's CSI 300 recovered earlier losses linked to the late-February US and Israeli strikes on Iran."
In China, the Shanghai Composite rose 0.76% to 4,082.13 and the Shenzhen Component added 0.55% to 14,966.75.
Espressif Systems Shanghai jumped 11.98%, Guangdong Guanhao High-Tech Co gained 10.08% and Hunan Huasheng rose 10.04%.
In Hong Kong, the Hang Seng Index climbed 0.77% to 26,361.07, with Xinyi Solar Holdings up 6.21%, Nongfu Spring advancing 5.5% and Sunny Optical Technology Group gaining 3.35%.
China kept its benchmark lending rates unchanged for an 11th consecutive month, with the People's Bank of China holding the one-year loan prime rate at 3.0% and the five-year rate at 3.5%.
The decision came as policymakers weighed the impact of rising global energy prices against resilient domestic growth.
The world's second-largest economy expanded 5% in the first quarter, up from 4.5% previously and at the top end of its target range, while factory-gate prices rose 0.5% in March and consumer inflation eased to 1% after a 1.3% increase in February.
Elsewhere, South Korea's Kospi 100 rose 0.49% to 7,190.75, with Doosan up 5.79%, LIG Nex1 gaining 5.14% and Samsung SDI advancing 4.87%.
Sydney and Wellington manage positive closes
Australia's S&P/ASX 200 edged 0.07% higher to 8,953.30, led by gains in Zip Co, up 7.73%, James Hardie Industries, up 7.06%, and Contact Energy, which rose 5.79%.
Across the Tasman Sea, New Zealand's S&P/NZX 50 added 0.08% to 12,915.45, with Air New Zealand up 2.27%, NZX gaining 2.16% and Fletcher Building rising 2.09%.
Economic data showed the country's trade balance swung to a surplus of NZD 698m in March from a deficit of NZD 257m in February, marking an NZD 955m turnaround and reflecting stronger export demand.
Dollar strengthens against regional peers
In currency markets, the dollar strengthened modestly, last rising 0.24% on the yen to trade at JPY 159.02, as it added 0.34% against the Aussie to AUD 1.3986 and gained 0.21% on the Kiwi to change hands at NZD 1.7035.
Munnelly added that "across cross-asset markets, safe-haven positioning was mixed," noting that "gold fell 0.8% to $4,790 per ounce, while silver slipped 1.0%, and Bitcoin eased modestly to around $74,500."
Reporting by Josh White for Sharecast.com.
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