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Global markets opened with mixed results as escalating tensions in the Middle East and a surge in oil prices weighed on investor sentiment. Following a losing week on Wall Street, stock futures showed little change, while European markets dipped and Asian indices presented a varied picture. Concerns over geopolitical instability are being closely watched, particularly as U.S.-Iran hostilities continue, pushing crude oil prices above $90 per barrel.
Investors are also anticipating a week of key earnings reports from tech giants like Alphabet and Tesla, while geopolitical risks and semiconductor sector weakness continue to be major themes.
Global stock futures showed mixed signals early Monday, following a week of losses on Wall Street, as escalating Middle East tensions impacted investor sentiment and drove oil prices higher. S&P 500 futures saw a slight uptick of 0.04%, while Nasdaq-100 futures rose 0.14%. However, futures tied to the Dow Jones Industrial Average dipped 0.11%.
European markets opened in negative territory, with the Stoxx 600 down 0.34%. The U.K.'s FTSE 100 fell 0.70%, Germany's DAX slipped 0.28%, and France's CAC 40 dropped 0.21%.
In Asia, South Korea's Kospi plummeted 4.5%, and the Kosdaq declined 5.3%. Australia's S&P/ASX 200 finished flat, while China's CSI 300 gained 1.5%. Japanese markets were closed for a holiday.
Last week, the three major U.S. indexes closed lower, with the S&P 500 down 1.6%, the Nasdaq Composite off 2.9%, and the Dow Jones Industrial Average losing 0.9%. The VanEck Semiconductor ETF (SMH) also saw its third weekly decline in four weeks, dropping nearly 9%.
Analysts suggest that the semiconductor sector may face further declines in the short term. Traders are closely watching the ongoing conflict in the Middle East, with U.S. military strikes against Iran continuing for a ninth consecutive night. The heightened hostilities have increased strain on the U.S.-Iran relationship, with a third U.S. service member reported killed in recent fighting.
These developments have pushed oil prices higher. U.S. West Texas Intermediate futures were up 2.79% to trade at $84.79 per barrel, and Brent crude futures gained 3.22% to reach $90.94 a barrel.
Investors are also anticipating a week of significant corporate earnings reports. Key tech giants like Alphabet and Tesla are set to release their results after the market close on Wednesday, followed by Intel on Thursday.
Asia-Pacific Markets Mixed, Oil Prices Spike on Geopolitical Tensions
Mainland China's CSI 300 closed 1.5% higher, boosted by the news of Zhongji Innolight's significant Hong Kong listing approval. Hong Kong's Hang Seng index also saw gains of 2.1% in the final hour of trading, with Alibaba shares rising 3.7% following the preview launch of its Qwen 3.8 Max AI model.
Ryanair experienced a 6% stock slide after warning of a "difficult winter" for European airlines due to higher fuel costs amidst the Middle East crisis. The budget carrier reported a 34% drop in first-quarter profit.
In the U.K., attention turned to political developments as Andy Burnham was set to become the country's fifth Prime Minister in four years.
European stock markets opened lower, with the Stoxx 600 down 0.22%. Oil and gas stocks led the gains, while technology stocks also saw a modest increase.
South Korea's Kospi closed down 4.5%, with major tech stocks Samsung and SK Hynix experiencing significant drops. Hyundai Motor shares also fell over 6% amid reports of extended worker strikes.
European stocks were expected to open mixed on Monday, with investors monitoring Middle East tensions and political changes in the U.K.
Alibaba shares jumped over 5% after unveiling its Qwen 3.8 AI model, positioning it as a competitor to leading global AI systems. This announcement comes shortly after Moonshot AI launched its Kimi K3 model.
Treasury yields edged up as geopolitical concerns persisted. The 10-year U.S. Treasury yield rose to 4.585%, and the 2-year yield increased to 4.183%.
Zhongji Innolight shares saw a significant rise following approval for a potential $8 billion Hong Kong listing.
Oil prices surged, with Brent crude breaching $90 per barrel, as escalating U.S.-Iran tensions raised concerns over energy supply disruptions through the Strait of Hormuz.
Hyundai Motor's shares declined over 6% due to potential production disruptions from extended worker strikes.
The Korea Exchange activated a sell-side sidecar on the Kospi, briefly halting trading as South Korean stocks plunged.
The CSI 300 opened flat, while the Hang Seng gained at the open. China's central bank kept benchmark lending rates unchanged.
Asia-Pacific markets traded mixed early Monday, with the Kospi opening lower and the S&P/ASX 200 gaining.
Asia-Pacific markets were poised for a subdued open, with investors focused on the ongoing Middle East conflict.
Oil prices rose on Sunday evening as Middle East conflict intensified.
U.S. equity futures traded around the flatline on Sunday evening.
