Asian markets fell in early trading Wednesday as Middle East tensions flared again after Iran fired more than a dozen missiles at two bases in Iraq that house U.S. troops.
U.S. officials said there were no immediate reports of casualties, and Iran’s foreign minister tweeted “We do not seek escalation or war,” leading some experts to speculate that the attack was a measured response to last week’s killing of a top Iranian general by a U.S. airstrike.
President Donald Trump issued a measured response, tweeting “All is well” and promising a statement Wednesday morning.
The attack sent crude oil futures CLG20, +1.31% BRNH20, +1.44% and gold futures GCG20, +1.13% briefly soaring, though those gains were pared as overnight electronic trading continued. U.S. stock futures YM00, -0.53% similarly plunged immediately after the attack, but largely recovered.
Stephen Innes, chief Asia market strategist for AxiTrader, said Trump’s response was, for now at least, “calming nerves, and risk assets are making a comeback as the market is taking some comfort in the lack of immediate U.S. military follow-through.”
Japan’s Nikkei NIK, -1.34% fell 2% and Hong Kong’s Hang Seng Index HSI, -0.80% slipped 0.7%. The Shanghai Composite SHCOMP, -0.57% declined 0.6% while the smaller-cap Shenzhen Composite 399106, -0.11% inched down 0.1%. South Korea’s Kospi 180721, -0.80% dropped 0.8%, and benchmark indexes in Taiwan Y9999, +0.05% , Singapore STI, -0.78% , Malaysia FBMKLCI, -0.91% and Indonesia JAKIDX, -0.70% were mixed. Australia’s S&P/ASX 200 XJO, -0.21% declined 0.3%.
Among individual stocks, oil producer Inpex 1605, -0.21% rose in Tokyo trading, while SoftBank 9984, -1.27% , Honda 7267, -1.97% and Fast Retailing 9983, -1.25% fell. In Hong Kong, oil company CNOOC 883, -0.29% slipped, as did Bank of China 3988, -1.52% and Alibaba 9988, -1.32% . Samsung 005930, +2.87% rallied in South Korea despite a warning that fourth-quarter operating profit will likely take a big hit. Beach Energy BPT, +1.69% and Oil Search OSH, +1.02% gained in Australia.