KOSPI index was the worst performer in Asia, dropping 4.3% after a long weekend

Most Asian stocks dropped further on Tuesday as hostilities between the U.S., Israel, and Iran showed few signs of ceasing, with South Korean markets leading losses in catch-up trade after a long weekend.

Losses in Chinese markets were relatively muted as investors awaited more signals on stimulus from a series of upcoming economic policy meetings, while Hong Kong benefited from gains in energy and tech shares.

Airline and tourism stocks dropped across Asia, while energy stocks surged on gains in oil prices.

A surge in oil prices and disruptions in global trade were the two biggest points of concern over the war, with the former standing to also drive up inflation.

KOSPI index was the worst performer in Asia, dropping 4.3% after a long weekend.

Stocks were also hit with a wave of profit-taking after a strong performance in February. Tech standouts SK Hynix Inc and Samsung Electronics Co Ltd, and automaker Hyundai Motor– which had all benefited from optimism over artificial intelligence– slipped between 5% and 8% on Tuesday.

Nikkei 225 and TOPIX indexes dropped more than 2% each on Tuesday, with mixed domestic data also adding to uncertainty over the country.

Among broader Asian stocks, Shanghai Shenzhen CSI 300 and Shanghai Composite indexes dropped relatively less than their peers– down nearly 0.2% apiece. Focus in China is squarely on the “two sessions” meetings scheduled between March 4 and March 11.

China’s top leadership is set to outline its 15th five-year plan for 2026-2030, and is expected to prioritize tech and industrial development.

Hang Seng index dropped 0.2%, with gains in some energy and tech stocks helping limit overall declines. PetroChina, CNOOC Ltd, and ENN Energy Holdings Ltd climbed between 1.9% and 4%, and were among the best performers on the Hang Seng.