Investing.com – Asian equities were under pressured in morning trade on Thursday as the threat of imminent U.S. military action in Syria caused concerns of heightened tension in the Middle East.
Overnight, the S&P 500 fell 0.6% and the Nasdaq slipped dropped 0.3%. Energy shares gained more than 1% as oil prices hit their highest levels since late 2014 on concerns about supply, while fear of conflicts in the Middle East boosted gold prices.
U.S. president Donald Trump’s comments about Russia and his warning of preparations to attack Syria on Wednesday were cited as catalyst for the selling in equities.
"I don't think we are heading into the World War Three but should there be a direct collision between the U.S. and Russia for the first time, that's the sort of headline that would plunge stock prices," said Hidenori Suezawa, financial market analyst at SMBC Nikko Securities.
The U.S. relationship with Russia is "worse now than it has ever been, and that includes the Cold War,” Trump said on Wednesday. “There is no reason for this. Russia needs us to help with their economy, something that would be very easy to do, and we need all nations to work together. Stop the arms race?"
Meanwhile, Facebook Inc (NASDAQ:FB)’s stock price continued to rise as the hearings that ended on Wednesday did not suggest any privacy legislation U.S. lawmakers might want to pursue against the company and provided no timeline for action.
In Asia, the Shanghai Composite and the Shenzhen Component lost 0.4% and 0.2% respectively by 9:49PM ET (01:49 GMT). Reports that China's ambassador Jia Guide warned on Wednesday that it would be disrespectful for the United States to drag Latin America into its trade dispute with Beijing garnered some attention.
"We truly despise the carrot and stick approach," Jia said in response to Trump's threats to reduce aid or impose tariffs on Latin American nations that do not do more to further efforts to create more U.S. jobs.
Japan’s Nikkei 225 gained 0.1%. Bank of Japan Governor Haruhiko Kuroda on Thursday reiterated his stance to maintain the central bank's stimulus program to achieve the bank's 2% inflation target.
Elsewhere, South Korea's KOSPI edged up 0.2%, while Australia’s S&P/ASX 200 fell 0.3%.