Hong Kong stocks record steepest weekly slump in 4 months on US-Iran war
For the week, the Hang Seng Index fell 3.3 per cent, the worst weekly performance since November 21
The Hang Seng Index closed 1.7 per cent higher at 25,757.29 on Friday. For the week, the benchmark declined 3.3 per cent, its steepest decline for the five-day period since November 21. The Hang Seng Tech Index surged 3.2 per cent.
On the mainland, the CSI 300 Index gained 0.3 per cent and the Shanghai Composite Index added 0.4 per cent.
The war in the Middle East has worsened sentiment on global stocks, which has already been rattled by fears of an artificial intelligence-led displacement. With Brent oil trading above US$80 a barrel after the closure of the Strait of Hormuz, investors are increasingly wary of stagflation and a slower pace of interest-rate cuts by the US Federal Reserve, which will further compress elevated stock multiples.
“Every tick in crude is sending shock waves through equities, bonds, foreign exchange and even crypto like a stone dropped into the middle of a still pond,” said Stephen Innes, a managing partner at SPI Asset Management. “The escalation in Iran has turned energy into a metronome for global risk and everything else is simply trying to keep time with it. When oil surges, the tape stiffens, yields grind higher and equities lose their footing.”
Iran launched a fresh salvo on Gulf states on Thursday, launching missiles and drones on the United Arab Emirates, Bahrain, Qatar and Kuwait. Iranian Foreign Minister Abbas Araghchi said that the nation had no intention of negotiating with the US.