Israel-related stocks under pressure after Hamas' shock attack
chipmakers, diamond processors and software-services providers.
Saturday’s assault has sparked fresh concern about geopolitical risks among investors just when global financial markets were already grappling with the impact of high-interest rates and the slowdown in China’s economy. Oil surged more than 5% while US equity futures dropped in Asia trading, as the risk of the conflict escalating across the Middle East region remains acute.
“The Israel-Hamas conflicts over the weekend may escalate geopolitical tensions in the Middle East region, causing risk-off trades,” Tina Teng, an analyst at CMC Markets wrote in a note. “Markets will be concerned about the rippling effects to the region.”
The MSCI Asia Pacific Index treaded water as markets in Japan, South Korea and Taiwan were closed for a holiday, while trading in Hong Kong was halted due to a typhoon.
Here are some global themes to watch:
Technology
Chip stocks from Nvidia Corp.
and Applied Materials Inc. to Taiwan Semiconductor Manufacturing Co. and Samsung Electronics Co.
may see an impact because of the possible impact on Intel Corp.’s plans.
The US semiconductor giant in June agreed to build a new manufacturing plant in Israel, as part of a push by the firm and its peers to diversify their production sources. Prime Minister Benjamin Netanyahu had at the time placed the deal’s value at $25 billion.
Datadog Inc. and other cybersecurity stocks will also be in focus due to the likely impact on Check Point Software Technologies Ltd., which is based in Tel Aviv.
