TOKYO -Asian stocks recovered some losses on Monday and bond yields rose as fears of a wider Middle East conflict ebbed, with investors gravitating back towards riskier assets.Iran said on Friday that it had no plan to retaliate following an apparent Israeli drone attack within its borders, which in turn followed an unprecedented Iranian missile and drone attack on Israel days before.
"It seems neither Israel nor Iran want an escalation in the crisis in the Middle East ... and with a subsequent strike from either side not looking like it's coming, investor concerns have eased somewhat," said Kazuo Kamitani, a strategist at Nomura Securities. MSCI's world equities index suffered its worst week since March 2023 last week, dropping 2.85%. Early on Monday, it was up just 0.05%.added 0.56%, underperforming the rest of the region due to a high concentration of chip sector shares, which tracked declines in U.S. peers from Friday. Taiwanese stocks slipped 0.05%.
Crude oil fell as traders put the focus back on fundamentals. With a rise in U.S. stockpiles as the backdrop,futures fell 67 cents, or 0.77%, to $86.62 a barrel. The front-month U.S. West Texas Intermediate crude contract for May, which expires on Monday, fell 63 cents, or 0.76%, to $82.51 a barrel, while the more active June contract dropped 64 cents to $81.58 a barrel.