Asia-Pacific markets opened mixed to lower, with US sanctions on Iran and escalating US-Canada trade tensions weighing on regional sentiment. The KOSPI led losses with a decline of 4.30%, while Australia's ASX 200 bucked the trend.

Market performance across the region

The divergence across Asia-Pacific indices reflected uneven investor response to the dual headwinds. South Korea's KOSPI bore the sharpest impact, while Japan's Nikkei 225 also traded in negative territory. Australia's benchmark index managed a modest gain.

The table below summarises opening moves across key Asia-Pacific indices:

Factors weighing on sentiment

Two developments shaped the cautious mood across markets. US sanctions on Iran introduced fresh uncertainty in energy and geopolitical risk calculations, while escalating trade tensions between the US and Canada added to concerns over North American trade flows and their broader economic implications for export-oriented Asian economies.

South Korea, with its heavy reliance on exports and global trade linkages, registered the steepest decline among the three indices. Japan's Nikkei 225 also retreated, reflecting sensitivity to global trade disruptions. Australia's ASX 200 managed to hold in positive territory, posting a gain of 0.33%, diverging from the broader regional trend.

Asia-Pacific equity markets advanced broadly, tracking a Wall Street rally underpinned by lower yields and a weaker dollar. The gains were widespread across the region, with South Korea's benchmark index leading the charge.

Regional market performance

The following table summarises the performance of key Asia-Pacific indices:

South Korea's KOSPI recorded the sharpest advance among the three benchmarks, rising 3.31%. Japan's Nikkei 225 followed with a gain of 0.98%, while Australia's ASX 200 posted a more modest increase of 0.53%.

Wall Street as the catalyst

The regional upswing came on the back of a rally on Wall Street, where lower yields and a weaker dollar provided the backdrop for improved investor sentiment. These two factors are widely watched in global markets, as they influence the relative attractiveness of equities and affect currency-sensitive export sectors across Asia-Pacific economies.