Hong Kong stocks retreat as Middle East tensions raise inflation risk
‘The Middle East is once again the fulcrum of global market anxiety,’ an analyst at SPI Asset Management says
The Hang Seng Index fell 0.3 per cent to 23,980.30 at the close. The Hang Seng Tech Index slipped 0.2 per cent. On the mainland, the CSI 300 Index and the Shanghai Composite Index were both little changed.
US President Donald Trump called for the evacuation of Tehran in a social-media post and cut short his stay at the Group of Seven leaders’ summit in Canada, fanning speculation that Israel may launch a new round of attacks on Iran. Heightened hostilities in the Middle East could increase the risk of a slowdown in global growth or even a recession by fuelling inflationary pressure at a time when the US is deadlocked in tariff talks with most of its trading partners.
“The Middle East is once again the fulcrum of global market anxiety,” said Stephen Innes, managing partner at SPI Asset Management in Bangkok. “It’s smouldering in real time while traders nervously bet on whether it fizzles or detonates. That’s no longer symbolic warfare. That’s a direct hit on the arteries of global crude and [liquid natural gas] flows.”