Global market wrap: Oil falls as G7 mulls releasing up to 400 million barrels, Asian stocks decline and more

Asian stock markets led the sell-off in global equities on Monday, with South Korea’s stock benchmark Kospi plunging over 8% to hit the circuit breaker.

We are back with quick updates about global stock markets and major developments across some of the top companies worldwide.

Major stock markets declined on Monday as crude oil prices surged above $100 a barrel for the first time since 2022 amid the intensifying crisis in the Middle East. However, oil prices eased after reports suggested that the G7 nations are likely to release up to 400 million barrels from their strategic reserves to address the global energy crisis.

In the United States, Futures linked to major indices tanked while most Asian markets extended losses as Iran named Mojtaba Khamenei to succeed his father, Ali Khamenei, as supreme leader.

Here’s a look at some of the important developments across the global markets:

G7 Finance Ministers to meet on emergency oil reserve release

With the US-Iran war sending oil prices above $100 a barrel, finance ministers of G7 countries, including the US, are holding an emergency meeting on Monday to discuss a coordinated release of oil from strategic reserves.

A report suggested that IEA executive director Fatih Birol and finance ministers will hold a call at 8.30 AM New York time to discuss the impact of the conflict between US-Israel and Iran. The US and two other G7 countries have supported the idea, it added.

The 32 members of IEA hold around 1.2 billion barrels of oil reserve and the US believes that a joint release of 300–400 million barrels would be appropriate, which accounts for 25–30% of the total reserves.

Brent crude has surged around 16% to $107 a barrel after the US and Israel targeted the oil infrastructure of Iran.

KKR mulls sale of data centre cooling specialist in multi-billion dollar deal

Private equity major KKR is mulling a multibillion-dollar sale of CoolIT System, which is a data centre cooling specialist.

According to a Financial Times Report, the deal could deliver an estimated tenfold return on the US private equity major’s investment.

KKR is expecting more than $3 billion from CoolIT, which it bought at a valuation of approximately $270 million in 2023. The company has engaged advisors to manage the potential sale process. Abu Dhabi's Mubadala Investment Company holds a minority stake in CoolIT.

Japan Display plans manufacturing unit in US

Japan Display is reportedly planning to set up a display manufacturing facility in the US under a huge $550 billion investment package by Japan. Washington and Tokyo are exploring plans for setting up the manufacturing facility, which is aimed at boosting local supplies of display, especially for military purposes, and cutting reliance on Chinese suppliers.

The proposed Japan Display facility is also aimed at addressing the US’s concerns over military dependence on Chinese display technology.

According to Nikkei Asia, the project could cost around $13 billion. Shares of loss-making Japan Display Inc. rallied 80% on Monday, taking its market valuation to 190 billion yen ($1.2 billion). Earlier, Japan Display was the world's leading vendor of LCD panels and a primary screen ​supplier for Apple's iPhones. It specialises in a wide range of display panels.

Global Stock Markets

Asian stock markets led the sell-off in global equities on Monday, with South Korea’s stock benchmark Kospi plunging over 8% to hit the circuit breaker. The sharp decline prompted the Korea Exchange to halt the trade for 20 minutes. South Korea is heavily dependent on Middle East oil and an a sharp rally in Brent crude triggered selling in Korean shares. The MSCI Asia Pacific Index tanked nearly 4% (at 8:51 GMT).

Among other major Asian indices, Japan’s Nikkei 225 dropped more than 5%. European shares also traded lower in the early session due to a rally in gas and oil prices. Germany’s DAX index fell 2.1%, the CAC 40 index in France by 2.4% and the UK’s FTSE 100 by 1.6% (at 8:05 GMT).

US stock futures also dropped with the S&P 500 down over 1.4% and the Nasdaq by 1.5% (8:50 GMT).

A strengthening dollar pushed safe-haven precious metals down, with Spot gold dropping by 1.4% to $5,096.05.