US-Iran Tensions Spark Global Market Volatility and Oil Price Surge

Asian markets experienced sharp declines on September 2 as global selloffs driven by US-Iran tensions pushed oil prices higher and bond yields surged.

The MSCI's broadest index of Asia-Pacific shares outside Japan fell 1.5%, while South Korea's KOSPI dropped more than 3% and Japan's Nikkei 225 declined by 2.6%

Brent crude futures extended gains for a second day, rising 1.3% to $95.91 a barrel after the US launched airstrikes on Iran.

Westpac analysts stated that 'the threat of further disruptions to the Strait of Hormuz has brought about renewed anxiety over inflation,' which drove selloffs in stocks and a rout in global bond markets

The yield on the U.S. 10-year Treasury bond hit an intraday high of 4.8122%, its highest level in almost three years, while the yield on the 5-year Japanese government bond rose to 2.295%, its highest level on record