oil surges, airlines sink, bonds defy safe-haven playbook
Investors work on the New York Stock Exchange during morning trading on February 27, 2026 in New York.
Michael M. Santiago | Getty Images
Global markets started the week negatively after the US and Israel’s attacks on Iran increased tensions in the Middle East and shook investors.
Asian markets started the day generally lower, with major markets in the region in negative territory. But some losses were partially offset by increases in oil and gold mining stocks, particularly in Australia.
Here are all the notable moves in financial markets as the Middle East conflict continues.
Energy stocks are on the rise
Energy prices rose as investors priced in the risk of a broader conflict in the Middle East.
Oil markets are now focused on the Strait of Hormuz, the world’s most critical energy transit point.
While the waterway has not been officially closed, tanker traffic has slowed to a near-halt due to rising war risk insurance premiums and shipping suspensions, JPMorgan said in a note, necessitating “an immediate re-pricing of geopolitical risk rather than a measured response to fundamentals.”
The bank also warned that if disruptions extend beyond three weeks, Gulf producers could exhaust storage capacity and be forced to shut down production; This scenario could push Brent to the $100-120 range.
Energy stocks in Asia are as follows: Woodside Energy And Santos Listed in Australia and Tokyo up over 6% inpex And Japan Oilsaw huge increases of 6.08% and almost 12% respectively.
Airline stocks remain weak
Airline stocks were the biggest losers overall, while all major airlines in Asia also headed for losses.
According to Circium, more than 50 percent of global flights to the Middle East region were canceled as of 6.30am Singapore time. The data provider said the figure could be higher because “some airlines have not officially updated their schedules or operated flights to cancel flights.”
of Australia Qantas fell 5 percent none of their flights were affectedFlag carriers of Japan are MAIN And Japan Airlines Additionally, losses of over 5% were recorded.
Nikkei reported It was stated that JAL canceled its flight from Tokyo to Doha on Saturday. Singapore Airlines While it lost value by 4.74%, Taiwan Eva Air also lost 4.47%.
Defense stocks are on the rise
Defense stocks posted modest gains. Regional activities in the defense sector also stagnated as South Korean markets were closed for a public holiday.
Japan’s defensive heavyweights Mitsubishi Heavy Industries And IHI rose above 3 percent. Singapore’s ST Engineering rose to 4 percent.
Analysts at Franklin Templeton wrote Monday that they favor energy, transportation, insurance and defense in the near term but are cautious about fuel-sensitive cycles such as airline stocks.
safe harbors
Gold, a classic safe haven, has soared amid rising geopolitical uncertainty and weakening bond yields, reinforcing its traditional role as a hedge in times of stress.
While spot gold increased by 1.89%, gold futures increased by 1.77%. Asian gold miners, mostly concentrated in Australia, also rose more than 4%. North Star Resources And Evolution Mining.
“There is clearly a tactical rotation into precious metals, especially in an environment defined by geopolitical stress and currency depreciation concerns,” said Kurt Hemecker, CEO of Gold Token SA.
Bitcoin pared earlier losses by 1.5% to $66,675, but remained well below its October peak of $126,000.
“Gold’s rally reflects demand for stability and balance sheet protection, while cryptocurrency weakness is more related to liquidity tightening and positioning fatigue,” Hemecker said.
On the currencies side, the dollar index strengthened by approximately 0.61%, while the Swiss franc also experienced a slight increase, gaining 0.1% against the dollar and trading at 0.7681.
However, in an unusual move, Asia’s safe-haven currency, the yen, lost 0.57% of its value against the dollar on Monday.
The yen’s weakness can be explained by Japan’s status as a net oil importer and the yen’s loss of luster during recent risk-off periods, according to Matthew Ryan, Head of Market Strategy at FX risk management services firm Ebury.
US yields rise
The Japanese yen wasn’t the only asset that moved against expectations. U.S. Treasury bonds also saw a rise in yields following the attacks, suggesting traders are selling bonds rather than seeking them as a safe haven.
Yields on US Treasury bonds increased marginally across all maturities. 10 year return increased by approximately 0.6 basis points. 30-year yields were 2 basis points higher.
Yields in Asia Japanese government bonds fell marginally across all maturities.
“Bond yields could rise in the short term due to concerns about higher inflation,” said Benjamin Jones, head of global research at Invesco.
While he said some government bond markets may benefit from safe-haven demand, inflation concerns will likely prevail.
“On this basis, and given U.S. energy independence, we suspect U.S. Treasuries may be less affected than European and Japanese government bonds.”
