- Asian markets fell as US blocked Strait of Hormuz after failed Gulf peace talks
- MSCI Asia-Pacific index dropped 0.7%, with Japan and South Korea markets declining
- US futures fell sharply; Dow dropped 517 points, S&P 500 and Nasdaq futures down over 1%
Asian markets sunk on Monday as market optimism of peace in the Gulf unravelled after US President Donald Trump ordered a blockade of the Strait of Hormuz, drawing a defiant tone from Iran, after weekend peace talks collapsed. The MSCI Asia-Pacific index dropped 0.7% after open.
The breakdown of negotiations in Islamabad on Saturday reignited worries that the war will last longer than feared, leading to higher oil prices that will continue to strain economies worldwide.
Japan's benchmark Nikkei 225 index fell 0.84%, while the broader Topix slipped 0.42%. South Korea's blue-chip Kospi was 1.83% lower. In Australia, the S&P/ASX 200 was 0.74% lower.
Hong Kong Hang Seng index futures stood at 25,964, compared with the index's last close of 25,893.54.
US stock futures tumbled. Dow Jones Industrial Average futures dropped by 517 points, or 1.1%. S&P 500 futures lost 1.1% and Nasdaq 100 futures shed 1.2%.
The dollar strengthened against all its Group-of-10 peers. Japan's 10-year yield rose to 2.49%, the highest since 1997. Euro Stoxx 50 futures fell 1.5%.
ALSO READ: Iran Strikes Defiant Tone As Trump Threatens Hormuz Blockade
Oil prices soared past $100 a barrel again after Trump's move that further disrupts crude flows from the Persian Gulf region. Benchmark Brent crude surged over 8% to cross the $103 per barrel mark, while US crude and European natural gas prices also recorded sharp gains. West Texas Intermediate rose to $105.12.
The Strait of Hormuz, a vital artery for global energy trade, has seen severely restricted activity since military tensions flared in late February with the outbreak of the US-Israeli war on Iran. Connecting the Gulf to international markets, the passage typically handles a significant share of the world's oil shipments.
ALSO READ: Brent Crude Jumps Past $103 Again As US Blockade Of Hormuz Spikes Supply Fears
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