Asian stock markets experienced a sharp decline on Monday as renewed conflict between Israel and Iran and expectations of US interest rate hikes triggered a regional sell-off.

Key Points

• South Korea’s KOSPI index plunged 8.29%, triggering a circuit breaker after falling nearly 9% during early morning trading.
• Tech giants Samsung Electronics and SK Hynix saw shares drop 10.2% and 7.6%, respectively, amid a broader retreat from AI-linked equities.
• Japan’s Nikkei 225 fell 3.9%, while Taiwan’s TAIEX, led by TSMC, declined 3.5% following negative momentum from Wall Street.
• Brent crude oil prices rose 3.7% to exceed $88.50 per barrel as geopolitical tensions in the Middle East intensified.
• US economic data showing strong job growth fueled investor concerns that the Federal Reserve may implement further interest rate hikes.

Why it Matters

The market volatility highlights how sensitive global equities remain to both geopolitical instability and shifts in US monetary policy. This downturn signals a potential cooling of the recent AI-driven investment boom as investors reassess risk in a high-interest-rate environment.