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Asian equity markets suffered some of their steepest single-session losses in years Monday as oil surged above $100 a barrel for the first time since 2022, with the widening Iran war pushing investors toward the dollar and out of risk assets — including crypto.
The selloff reflects a market increasingly pricing in a prolonged conflict. With the Strait of Hormuz effectively shut and Iranian strikes spreading across the Gulf, analysts warn the worst may not yet be reflected in asset prices.
Stocks Slide Across the Region
Japan’s Nikkei 225 plunged 6.2% to 52,166 in the opening minutes of trade, with the broader Topix falling 4.3%. South Korea’s Kospi sank 6.3%, dragged lower by Samsung Electronics and SK Hynix, each down around 7%. Australia’s S&P/ASX 200 fell 3.3%. S&P 500 futures dropped 1.6%, and Nasdaq 100 futures fell as much as 2%, signaling further pain for US markets at the open.
WTI surged as high as $111, and Brent traded near $110 at the Asian open, both at their highest since early 2022, as the Strait of Hormuz remained effectively shut and Gulf producers began curbing output. A separate story covers the oil market in detail.
Geopolitical Backdrop Darkens
On Sunday, Iran pressed attacks on neighboring Gulf states, with Qatar, Kuwait, and Bahrain all reporting missile and drone strikes. The US ordered non-emergency embassy staff to leave Saudi Arabia. On Monday, Iran fired its first missiles toward Israel under newly appointed Supreme Leader Ayatollah Mojtaba Khamenei. US President Donald Trump said attacks would continue “until they surrender or, more likely, completely collapse.”
Dollar Gains, Crypto Slides
The US Dollar Index (DXY) rose 0.69% to 99.67, extending its safe-haven rally amid heightened inflation risk and prolonged energy disruption. Gold fell 2.2% to $5,056 an ounce as higher-for-longer rate expectations weighed on non-yielding assets. The 10-year Treasury yield rose five basis points to 4.19%.
Bitcoin fell 1.4% to $66,374, and Ether dropped 1.1% to $1,950, tracking the broader risk-off move. The dollar has emerged as the primary beneficiary of the conflict, analysts say, given the US’s safe-haven status and its position as a net energy exporter — with further gains contingent on how long the war lasts.
US nonfarm payrolls fell by 92,000 last month — one of the largest declines since the pandemic — adding to stagflation risk amid an already fragile macro backdrop.
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