On June 17th and 18th, global markets faced significant volatility due to escalating tensions in the Middle East. Fears of US involvement in the Iran-Israel conflict and potential disruptions to crude oil supplies triggered notable price movements across various sectors.
WTI crude oil prices surged by 5.17% on June 17th, closing the session at $73.455. This rise in oil prices could exacerbate inflationary pressures, potentially leading central banks to postpone interest rate cuts and impacting overall market risk sentiment.
The Hang Seng Index continued its decline on June 18th, with electric vehicle (EV), real estate, and technology stocks experiencing downward pressure. The index fell 1.2% to 23,693 in early trading. Mainland China's markets also saw early losses, with the CSI 300 and Shanghai Composite Index dropping 0.32% and 0.46%, respectively.
The escalation of the Iran-Israel conflict and concerns about crude oil supply disruptions weighed heavily on investor sentiment. The Hang Seng Mainland Properties Index declined by 2.27%. Major tech companies like Alibaba (09988) and Baidu (09888) saw drops of 2.61% and 1.70%, respectively, contributing to a 1.46% decrease in the Hang Seng Tech Index.
EV stocks also faced declines, with BYD (01211) falling 0.39% and Li Auto (02015) tumbling 4.7%. US equity markets also trended lower on June 17th, with the Nasdaq Composite Index falling 0.91%.
The deployment of US fighter jets to the Middle East on June 17th heightened concerns about US involvement. Donald Trump's call for Iran's unconditional surrender further intensified the situation. Investor focus remains on the Israel-Iran war, trade developments, and potential stimulus measures from Beijing, which will likely determine the future direction of the Hang Seng Index.