Markets in Europe gain while Asian shares swoon as the war with Iran
widens and oil surges higher
[March 04, 2026] By
ELAINE KURTENBACH
BANGKOK (AP) — European shares opened higher on Wednesday after another
day of sell-offs in Asia, where South Korea’s benchmark plunged more
than 12%.
U.S. futures were 0.3% lower.
Oil prices climbed more than 3% as the United States and Israel war with
Iran entered its fifth day, with Israel targeting the Iranian leadership
and security forces and the Islamic Republic hitting back with missile
barrages and drone attacks across the region.
Worries over the war, which U.S. President Donald Trump has suggested
could last a month or longer, have hammered world markets, spooking
investors who fear more spikes for oil prices may grind down the global
economy and sap corporate profits.
“I think the Iran situation is getting out of hand, and I think that
U.S. President Donald Trump miscalculated enormously," said Francis Lun,
CEO of Venturesmart Asia. “The situation is very grim."
Still, sentiment appeared to steady early Wednesday in Europe, where
Germany's DAX edged 0.2% higher to 23,851.86. In Paris, the CAC 40 was
nearly unchanged at 8,105.25. Britain's FTSE 100 edged 0.1% lower to
10,470.00.
In Asia, South Korea's Kospi led the regional losses as energy security
concerns eclipsed optimism over the boost computer chipmakers like
Samsung Electronics and SK Hynix have been getting from expanding use of
artificial intelligence.
The Kospi sank 12.1% to 5,093.54. Samsung's shares dropped 11.7%, while
SK Hynix gave back 9.6%.
The Korea Exchange temporarily halted trading for the Kospi index, while
a circuit breaker was also triggered on the tech-oriented Kosdaq after
it fell by more than 8%. It later dropped nearly 14%.
South Korea’s stock market has been one of the world’s best performers
this year, but its economy depends heavily on trade and fuel imports,
that are threatened with disruptions to traffic through the Strait of
Hormuz, the narrow gateway to the Persian Gulf through which roughly a
fifth of globally traded oil passes.
Trump announced Tuesday that he had ordered the U.S. Development Finance
Corp. to provide political risk insurance and guarantees for financial
security of all maritime trade.
“If necessary, the United States Navy will begin escorting tankers
through the Strait of Hormuz, as soon as possible,” Trump said in a
message posted by the White House on X.
Still, the price of U.S. benchmark crude oil climbed more than 3.5%, to
$77.18 per barrel. Brent crude, the international standard, gained 3.7%
to $84.38 per barrel. Its price has jumped about 15% since the war
began.
“Trump’s assurances of the US underwrite shipping insurance against
Middle East conflict risks and even U.S. naval escorts only mitigate,
but do not eliminate, enduring upside risks to oil prices,” Mizuho Bank
said in a commentary.
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A person walks by an electronic stock board showing Japan's Nikkei
index at a securities firm in Tokyo Wednesday, March 4, 2026.
(Masanori Kumagai/Kyodo News via AP)
 The increased insurance costs
filtering through to shipping would ultimately cost an extra $5 to
$15 a barrel, it said, adding that the "‘war premium’ remains firmly
intact.”
In Tokyo, the Nikkei 225 shed 3.6% to 54,245.54. Like South Korea
and Taiwan, Japan depends heavily on imports of oil and natural gas
from the Persian Gulf.
Elsewhere in Asia, the Hang Seng in Hong Kong fell 2% to 25,249.48
and the Shanghai Composite index shed 1% to 4,082.47.
In Australia, the S&P/ASX 200 declined 1.9% to 8,901.20.
Taiwan's Taiex lost 4.4% and shares in Bangkok sank 6%.
On Tuesday, the S&P 500 finished with a loss of 0.9% after dropping
as much as 2.5% on concerns over the war’s damage to the economy.
The Dow Jones Industrial Average pared its loss to 0.8% and the
Nasdaq composite fell 1%.
Some analysts say stocks could rebound if the war ends soon. If it
drags on, higher inflation partly due to rising energy prices could
tie the Federal Reserve’s hands and keep it from cutting interest
rates.
For now, one of the most evident impacts on the economy has been a
surge in gasoline prices.
While drivers in Europe and some Asian cities waited in line to fill
their tanks with fuel, as a net oil exporter the U.S. does not face
a shortage. But prices are still influenced by global market trends.
In the U.S., a gallon of regular was selling for $3.11 on average,
up 11 cents, according to motor club AAA, surprising some drivers at
the pump. Gasoline prices were already rising before the U.S.
launched strikes on Iran as refiners were switching over to summer
blends of fuel.
In other dealings early Wednesday, the dollar fell to 157.46
Japanese yen from 157.74 yen. The euro slipped to $1.1604 from
$1.1612.
The price of gold rose 1.2%, while silver gained 2.6%.
___
Associated Press writer Kim Tong-hyung in Seoul, South Korea,
contributed.
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