Stocks tumble, safe-haven assets rally after rockets hit airbases in Iraq

New York Stock Exchange
Pedestrians pass in front of the New York Stock Exchange (NYSE) in New York, U.S., on Tuesday, Dec. 31, 2019. U.S. stocks fell in thin end-of-year trading, as rising tensions in the Middle East drove some profit taking after one of the strongest years for equities in the past decade. Photographer: Michael Nagle/Bloomberg via Getty Images

Stocks tumbled, while safe-haven assets rallied on Wednesday after more than a dozen rockets hit an airbase that houses US forces in Iraq.

Japan’s Nikkei slid as much as 2.6% Wednesday morning, falling below 23,000 for the first time in about two months. It was last down 2.4%.

Dow futures, meanwhile, were last down about 330 points, though they had fallen below 400 earlier. Futures for the S&P 500 were down 1.3%, while Nasdaq futures slid 1.5%.

Among other major markets, South Korea’s Kospi lost 1.3% and Hong Kong’s Hang Seng Index dropped 1.1%. China’s Shanghai Composite shed 0.5%.

Safe-haven assets rallied. The Japanese yen strengthened to 107.89 yen per US dollar, up 0.5% from the previous day. Gold rose 1.8% to above $1,600 per ounce. Cryptocurrency Bitcoin was up more than 6% to $8,399.82.

US crude jumped nearly 4% to around $65 a barrel during Asian trading hours on Wednesday. Crude, which settled at $62.70 a barrel during regular trading Tuesday, climbed as high as $65.65 a barrel. Brent crude, a global oil benchmark, also rose as much as 5% to $71.75 a barrel.

At least 10 rockets hit the al-Asad airbase in Iraq, which houses US forces, a Sunni commander of the paramilitary forces in a nearby town told CNN.

Iranian state TV reported that Iran’s Islamic Revolutionary Guard Corps, or IRGC, “has hit U.S. Ain al-Asad airbase in Iraq with tens of missiles.” The IRGC warned the US of of more “crushing responses in case of new aggression,” according to state TV. The IRGC said it will target any regional state that becomes a platform for US aggression, a second banner on state TV read.

On Tuesday, the Dow ended its trading day down 120 points as investors braced for Iran to retaliate against the United States. Last week, a US drone strike killed Qasem Soleimani — an Iranian commander and one of the country’s most powerful men. He was head of the Revolutionary Guards’ Quds Force, an elite unit that handles Iran’s overseas operations — and one deemed to be a foreign terrorist organization by the United States.

— Hamdi Alkhshali and Nectar Gan contributed to this report.