Asia stocks trade mixed as Israel-Iran crisis escalates

June 17, 2025 (MLN): Asia-Pacific markets traded mixed on Tuesday as investors weighed escalating geopolitical tensions in the Middle East.

The Israel-Iran conflict drew heightened attention after U.S. President Donald Trump urged "everyone" to immediately evacuate Tehran.

The president also left the Group of Seven (G7) summit a day early, citing the crisis in the region, as CNBC reported.

Despite the growing concern, Fitch Ratings said the potential spillover from the conflict appears manageable within Israel’s current ‘A’/Negative rating level.

“The fighting will remain contained between Israel and Iran, and will not persist for more than a few weeks,” Fitch analysts noted in a statement issued Monday.

Adding to the sentiment, Samy Chaar, chief economist and CIO Switzerland at Lombard Odier, said the confrontation looks “very much controlled so far,” although volatility in commodity markets has triggered some market jitters.

“Even without an escalation in the conflict, lingering uncertainty and structurally higher energy costs retain the potential to slow economic growth and push inflation higher,” Chaar added.

Meanwhile, the Bank of Japan kept its benchmark interest rate steady at 0.5%, as expected, citing ongoing trade and geopolitical uncertainties.

On the regional front, Japan’s Nikkei 225 rose 0.58%, while the Topix index added 0.29%. South Korea’s Kospi advanced 0.24%, with the Kosdaq closing flat.

China’s CSI 300 dipped 0.15%, and Hong Kong’s Hang Seng Index slipped 0.12%.

Australia’s S&P/ASX 200 declined 0.13%, while India’s Nifty 50 and BSE Sensex dropped 0.29% and 0.15% respectively.

U.S. stock futures edged lower during Asian hours as investors continued to monitor developments in the Middle East.

However, Wall Street ended higher overnight on hopes that the conflict might be resolved diplomatically.

The Dow Jones Industrial Average gained 317.30 points, or 0.75%, closing at 42,515.09.

The S&P 500 rose 0.94% to 6,033.11, while the Nasdaq Composite jumped 1.52% to settle at 19,701.21.

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