Asian markets settled lower on Wednesday tracking Wall Streets’ fall overnight as investors monitored developments in the Middle East. Market sentiments weakened on concerns that rising energy prices, fuelled by the US and Israel’s escalating conflict with Iran, could slow economic growth and stoke inflation. Chinese and Hong Kong shares tumbled amid mixed Chinese PMI data. Official data showed Chinese manufacturing and services sectors contracted for a second consecutive month in February, while a private survey indicated that both manufacturing and services activity accelerated last month. Further, investors were keeping close eye on the annual National People’s Congress with expectations for a 4.5% to 5% growth target for 2026 and details on the 15th Five-Year Plan (2026–2030). Japanese shares fell as the Iran conflict escalates. Bank of Japan Governor Kazuo Ueda warned that the Middle East conflict could significantly affect Japan’s economy, signalling the central bank is likely to keep rates steady for an extended period. Kospi plunged more than 12%, recording its largest-ever daily loss, with Samsung Electronics and SK Hynix taking the hardest hit. The market participants overlooked the report saying Trump vowed that the US Navy would begin escorting oil tankers and other commercial vessels through the Strait of Hormuz if necessary to ensure the ‘free flow of energy to the world’.