Most Asian markets opened lower amid heightened tensions in the Middle East following a joint air strike by the U.S. and Israel that killed Iran's Supreme Leader Ayatollah Ali Khamenei to end his 36‑year iron rule, prompting fears of further disruption to air travel and energy supply chains.
Hong Kong's Hang Seng Index opened 1.2 percent lower at 23,610 points, and Japan's Nikkei 225 plunged over 2 percent and its broader Topix slipped 1.24 percent in early trading. China's CSI 300 edged down 0.25 percent, while Australia's S&P/ASX 200 fell 0.48 percent.
Airline stocks led losses across the region, with Singapore Airlines falling more than 6 percent, Japan's ANA and JAL each dropping over 4 percent, and Hong Kong's Cathay Pacific slipping 3.6 percent. Australia's Qantas and Taiwan's Eva Air also shed more than 4 percent as investors fretted over rising fuel costs and operational uncertainties.
Energy-related shares across Asia gained buoyed by rising oil prices, with Japan's INPEX, Australia's Woodside Energy, and China's Hong Kong-listed National Offshore Oil Corporation (CNOOC) all climbing more than 5 percent.
Defense stocks also saw modest gains, with Japan's defense giants Mitsubishi Heavy Industries, Kawasaki Heavy Industries, and IHI each rising more than 1 percent, while Singapore's ST Engineering climbed 2 percent.
Oil futures surged amid the escalation, with West Texas Intermediate (WTI) crude oil last trading at US$69.68 per barrel and Brent crude oil at $76.13. Gold futures also jumped 2.3 percent as investors flocked to safe-haven assets.
The South Korean stock market is set to resume trading on Tuesday after a long weekend, with analysts expecting investors to closely monitor airline, defense and energy-related stocks amid escalating Middle East tensions that could heighten volatility and weigh on import-dependent industries.
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