Emerging market stocks decline on West Asia tensions

Emerging-market stocks experienced a decline as increasing tensions in the Middle East prompted investors to seek safer assets. The MSCI index, which measures the performance of equities from developing nations, dropped for the third consecutive day and may set a record for consecutive declines in almost two months. South Korea's Kospi index fell by more than 3% following calls from major AI companies for a slowdown in technology development, which raised concerns about the sector's contribution to the recent rally.

The index of emerging-market currencies remained relatively stable after falling in the previous two sessions. The Thai baht and Philippine peso led the losses in emerging Asia, as higher oil prices impacted energy-importing economies. Additionally, the South Korean won and Taiwanese dollar also experienced declines. Brent crude oil prices increased by 2.9% to $107.65 a barrel after Saudi Arabia closed its East-West pipeline, which serves as an alternative to the Strait of Hormuz for oil exports following several attacks.

A planned meeting between Iran and several Gulf nations to establish a temporary shipping lane through the Strait of Hormuz was postponed, according to Oman's foreign minister. Traders are anticipating central-bank decisions this week, beginning with the Federal Reserve on Wednesday, followed by the Bank of England and Bank of Japan, as policymakers try to determine the direction of global interest rates amid renewed inflation risks due to higher oil prices.