Asia Pacific markets retraced some losses on Wednesday but remained broadly lower. Earlier, shares tumbled when reports said rockets were fired at an Iraqi airbase that hosts American troops.
The Nikkei 225 shed 370.96 points, or 1.6%, to 23,204.76. Japanese Prime Minister Shinzo Abe is said to have cancelled a scheduled trip this weekend to the Middle East.
The Hang Seng index tumbled 234.14 points, or 0.8%, to 28,087.92.
Iran launched more than a dozen ballistic missiles against multiple bases housing American troops in Iraq, Pentagon officials said on Tuesday. It was not immediately clear if any U.S. service members were hurt in the strikes and President Donald Trump responded on Twitter, saying he will make a statement on Wednesday morning during U.S. hours.
The strike follows the U.S. killing of Iran’s top general, Qasem Soleimani, last Thursday in Baghdad. Iran had promised retaliation after the attack.
Singapore stocks faded slightly. Singapore Airlines shares were 0.4% lower as the carrier said it was diverting all flights in and out of Europe from Iranian airspace.
Energy names in the region gained: In Australia, Santos shares rose 1.1%, Oil Search rose 0 9% and Woodside Petroleum added 1.4%.
Japan’s Inpex rose 0.3% and Japan Petroleum was up 0.5%.
Defense stocks in Asia also surged on Wednesday, some by more than 20%.
The Japanese yen, another safe-haven asset, traded at 108.4 versus the U.S. dollar. Earlier in the day, the yen strengthened to levels around 107.63 per dollar.
The Australian dollar was at around $0.6880, climbing from an earlier low around $0.6847.
In other markets
In Shanghai, the CSI 300 dropped 47.91 points, or 1.2%, to 4,112.32.
In Taiwan, the Taiex stumbled 63.22 points, or 0.5%, to 11,817.10
In Korea, the Kospi index fell 24.23 points, or 1.1%, to 2,101.31
In Singapore, the Straits Times Index dipped 1.97 points, or 0.1%, to 3,245.89
In New Zealand, the NZX 50 moved back 72.88 points, or 0.6%, to 11,556.98
In Australia, the ASX 200 lopped off 8.81 points, or 0.1%, to 6,817.63