Hang Seng Index Slips Amid Middle East Tensions and Fed Anticipation

The Hang Seng Index closed at 25,925.65 on Monday, marking a marginal decline of 52.42 points, or 0.20%. The index fluctuated between a low of 25,858.24 and a high of 26,086.02 throughout the session, struggling to maintain momentum after a recent two-day slide that saw the index drop over 575 points. Market sentiment remained fragile as investors navigated a murky global landscape. The primary driver of uncertainty is the current state of conflict in the Middle East, specifically following the collapse of peace talks between the U.S. and Iran over the weekend. This geopolitical friction has led to a split in Asian market performance and choppy trading on Wall Street. Sector performance within Hong Kong was mixed. While financial and property shares dragged the index lower, the market found support in technology and oil-related equities. This support coincided with a surge in crude oil prices; West Texas Intermediate for June delivery climbed 2.46% to $96.72 per barrel as supply disruption concerns intensified. Attention is now shifting toward the U.S. Federal Reserve's monetary policy decision scheduled for Wednesday. While the central bank is widely expected to leave interest rates unchanged, traders are closely analyzing the accompanying statement for clues regarding the future trajectory of rates. Locally, market participants are awaiting the release of March trade figures for Hong Kong. In February, the region reported a trade deficit of HKD 64.2 billion, despite strong annual growth in imports, which rose 29.9%, and exports, which increased 24.7%.