Asian markets opened with a cautious tone Monday as geopolitical tensions in the Middle East continued shaking investor confidence. U.S. President Donald Trump's stern warning to Iran — threatening devastating military strikes if the Strait of Hormuz remains closed past Tuesday — sent ripples across stocks, bonds, and commodities at the start of the trading week.
Equity performance was uneven amid thin holiday liquidity across much of the region. S&P 500 e-mini futures dipped 0.2%, while the MSCI Asia-Pacific ex-Japan index edged 0.5% higher. Japan's Nikkei 225 outperformed with a 1.2% gain, and South Korea's Kospi climbed 2%, suggesting selective optimism despite the broader uncertainty.
Oil markets reacted sharply to the escalating standoff. Brent crude surged 1.4% to $110.58 per barrel after OPEC+ members agreed Sunday to boost output by 206,000 barrels per day in May. However, analysts noted the production increase remains largely symbolic, as several key Gulf producers have suffered significant damage to oil facilities and transport networks since the conflict began.
Bond markets reflected growing unease. The U.S. 10-year Treasury yield rose nearly 5 basis points to 4.36%, while Japan's government bond yield hit its highest level since February 1999, climbing to 2.4% amid mounting inflation concerns. The U.S. dollar index held steady near 100.23, with the greenback flat against the Japanese yen at 159.64.
On the data front, March's U.S. jobs report offered an encouraging signal, with nonfarm payrolls rising by 178,000 — the strongest monthly gain in over a year. The unemployment rate dropped to 4.3%. Despite the solid labor market reading, market expectations for Federal Reserve rate cuts remain muted, with traders pricing in no policy changes until September 2027.
Gold retreated 0.8% to $4,638.54, while Bitcoin advanced 1.9% to $68,915.85, and Ether gained 2.4% to $2,117.61. Investors will be closely watching upcoming releases including the FOMC minutes, CPI data, and personal income figures as geopolitical developments continue driving market direction this week.


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