Hong Kong stocks retreated by the most in nearly a year on Monday alongside risk assets in Asia, while oil and gold surged after the US strikes on Iran, reports the South China Morning Post. This comes as surging geopolitical risks sparked a risk-off mode among investors.

The Hang Seng Index closed 2.12% down at 26,067.27. At one point, the gauge dropped by as much as 2.8%, setting it on track for the biggest decline since April 7, 2025, when US President Trump’s “Liberation Day” tariff announcement sent the benchmark falling 13%.

On the mainland, the CSI 300 Index slipped 0.1% and the Shanghai Composite Index was little changed. Brent crude rose as much as 14% to $82.37 a barrel, heading for its highest level since January 2025, while spot gold rose 1.3% to $5,346.17 an ounce.

Airline shares plunged on Monday, with Hong Kong’s Cathay Pacific down more than 5%, and Air China, China Southern Airlines, China Eastern Airlines fell at least 4% after the US and Israel launched weekend strikes on Iran, disrupting travel and sending oil prices surging, reports Reuters.

Global air travel remained in turmoil on Monday as war in Iran forced the closure of key Middle Eastern hubs including Dubai and Doha for a third day, stranding tens of thousands of passengers worldwide and disrupting thousands of flights.

Cathay Pacific said it had cancelled all of its flights to the Middle East, which include passenger services to Dubai and Riyadh, until further notice. Data provider VariFlight said Chinese airlines had so far cancelled 26.5% of flights to and from the Middle East from March 2 to March 8.

Major carmakers in China have launched a new wave of price cuts and financing incentives immediately after the Spring Festival holiday, reports Caixin. Manufacturers aim to clear excess inventories as sales slow in the world’s largest auto market.

SAIC General Motors’ Buick brand said Thursday that it would lower prices on multiple models by RMB 5,000 ($724). The move followed an announcement Wednesday by SAIC Audi, which introduced limited-time purchase incentives worth RMB 30,000, cutting the starting price of one model to RMB 205,900. Earlier in the week, joint ventures GAC Toyota Motor and Dongfeng Nissan Passenger Vehicle lowered prices on new models, with one Dongfeng Nissan entry-level vehicle falling to RMB 65,900.

The burst of promotions highlights mounting pressure across the industry, where weakening demand and the expiration of government subsidies have left dealers saddled with unsold vehicles despite efforts to steady the market.

Amid intensifying competition among Chinese electric-vehicle (EV) makers last year, relatively inexpensive models from Geely Auto and Wuling Motor Holdings topped the sales chart, reports the South China Morning Post. Sales from the two companies surpassed those from BYD and Tesla.

In 2025, Geely sold more than 459,000 units of the Xingyuan EV–priced between RMB 68,800 ($9,960) and RMB 98,800–versus 52,570 a year earlier, according to a list of the top-selling battery EV models on the mainland compiled by a unit under the state-owned China Automotive Technology and Research Center.

It was followed by Wuling’s Hongguang Mini EV, another sub-RMB100,000 car, whose sales jumped 55% year on year to 427,000 units.

China’s central bank set the yuan’s daily fixing rate at its strongest level since mid-2023 on Wednesday, reports the South China Morning Post. This comes as the Chinese currency extended gains with investors increasingly rotating out of US dollar assets amid concerns over the Federal Reserve’s independence and US debt sustainability.

The People’s Bank of China set the yuan’s midpoint rate–also known as the daily fixing rate–at 6.9438 to the US dollar, which marked the strongest level in 33 months. 

The move followed months of steady appreciation in the yuan, with its offshore rate trading at 6.909 per US dollar as of early afternoon on Wednesday.