[MARKET UPDATE] Bloodbath in Asia-Pac amid the conflict in the Middle East and shipping disruption

APAC Stocks: Negative

• Asia-Pac stocks extended on losses with markets roiled by the widening conflict in the Middle East, with the UAE reportedly considering taking military action to stop Iranian missile and drone strikes on the country, while it was also estimated that Saudi Arabia could attack Iran soon.

ASX 200: -2.0%

• Slumped with the index dragged lower by underperformance in the commodity-related sectors, while better-than-expected Australian GDP data for Q4 failed to inspire a turnaround.

Nikkei 225: -3.9%

• Remained pressured and fell to around the 54,000 level with mining and materials the worst performing stocks amid disruption concerns.

KOSPI -10.8%

• Continued to sell off and triggered a circuit breaker with declines led by shipbuilders and shipping companies, while large exporters such as Samsung Electronics, SK Hynix and Hyundai Motor also suffered notable losses.

Hang Seng & Shanghai Comp: Hang Seng -2.8% / Shanghai Comp -1.4%

• Conformed to the bloodbath in the region as participants digested mixed Chinese PMI data in which the official NBS Manufacturing and Non-Manufacturing PMIs disappointed, but the private sector RatingDog PMI accelerated to multi-year highs, while attention is also on the Two Sessions, which begins today in Beijing.

US Equity Futures: Lower

• Retreated amid the broad sell-off seen in Asia-Pac trade.

European Equity Futures -0.1%

• Indicate a slightly lower cash market open with Euro Stoxx 50 futures down 0.1% after the cash market closed with losses of 3.6% on Tuesday.

The ongoing conflict in the Middle East is significantly impacting the Asia-Pacific markets, leading to substantial losses across major indices. The threat of military action from the UAE against Iranian strikes, alongside Saudi Arabia's potential aggression, has heightened geopolitical tensions, causing a sell-off in sensitive sectors like commodities and shipping. This turmoil is likely to weigh on market sentiment globally, with US and European futures also indicating a lower open as investors react to the broader regional instability.