Investing.com – Most Asian stocks fell sharply on Monday as risk sentiment was dented by Iran’s attack on Israel, while persistent concerns about higher, longer-term U.S. interest rates also weighed on pressure.
The only top gainers on the day were Chinese stocks, rising from more than a month lows as Beijing pledged more support.
Regional markets underperformed Wall Street, which fell on Friday amid rising concerns about rate cuts and weak earnings at big banks. However, futures for US stock indexes rose slightly in Asian trading.
Asian shares fall amid Iran-Israel tensions and interest rate concerns
Japanese shares were the worst performers of the day, losing 1.2%, as investors continued to take profits near recent record highs.
Data showing an economic recovery in February, indicating improvement in capital spending, had little impact on sentiment. March data due later this week is key for Japanese markets.
South Korean shares fell 0.8% as trade data for March showed a limited gain, albeit down.
Australian shares shed 0.5% even as rising metals prices lifted some mining shares.
India index futures pointed to a negative opening after the index fell from record highs on Friday.
India’s inflation figures will also be released later this week.
Regional markets faced weak risk appetite after Iran’s strike on Israel over the weekend fueled fears of a wider war in the Middle East. But the impact of the strike was limited, and Tehran also signaled the end of its offensive against Israel.
Asian shares also rose weakly after Wall Street closed on Friday. US stock indices fell sharply after a series of weak reports on shares of major banks.
Better-than-expected inflation data released last week also led markets to largely scale back expectations of an early interest rate cut.
Chinese stocks rise thanks to government support
China’s indexes and indices rose 1.8% and 1.2% respectively, recovering from month-and-a-half lows hit last week.
Sentiment towards local equities was also boosted by local media reports that the government had pledged more support to local capital markets.
Large state-owned funds backed by the government also bought shares of large Chinese banks, providing a key support point for China’s stock indexes.
Chinese markets were rattled by weak economic data last week, and March data fell short of expectations.
Stocks in Hong Kong continue to reflect negative sentiment towards China. Shares fell 0.7% on Monday, weighed down by losses in mainland Chinese stock markets.