Asia-Pacific markets mixed as Israel–Iran tensions undermine sentiment

June 18, 2025 (MLN): Asia-Pacific markets showed divergent performance on Wednesday, weighed down by rising Middle East tensions.

Investors grew cautious after U.S. President Donald Trump hinted at possible military action against Iran, even urging its Supreme Leader to "surrender" in an emphatic Truth Social post. Intelligence sources reported Trump is contemplating targeted strikes.

ANZ strategists warned that his aggressive tone has stoked fears of deeper U.S. involvement in the Israel–Iran conflict, as CNBC reported. 

In Japan, the Nikkei 225 advanced 0.5–0.7%, with the Topix up about 0.4%, boosted by risk-on sentiment amid a softer yen. South Korea’s Kospi climbed roughly 0.7%, while the Kosdaq rose about 0.66%.

May exports from Japan fell 1.7% year-over-year—better than the expected 3.8% drop—just a day after the Bank of Japan cautioned that global trade could drag on domestic corporate profits.

Conversely, Hong Kong’s Hang Seng dropped nearly 0.9%, whereas mainland China’s CSI 300 posted a modest gain of 0.2%. U.S. stock futures eased ahead of the Federal Reserve’s policy announcement later in the day.

On Wall Street overnight, the Dow fell 0.7%, the S&P 500 lost 0.8%, and the Nasdaq declined 0.9%.

Copyright Mettis Link News