Asian equity markets retreated on Monday as investor confidence in a potential US-Iran peace agreement waned, reigniting concerns over Middle East stability.
The shift in geopolitical sentiment triggered a broad-based repricing of risk across the region, with major benchmarks closing lower as traders adjusted positions ahead of the European open.
The sell-off reflects a growing skepticism among investors regarding the prospects for a diplomatic resolution between Washington and Tehran.
As the likelihood of a near-term deal diminished, market participants moved to hedge against renewed geopolitical friction, driving selling pressure into equities sensitive to regional instability.
European stocks are expected to start the new week on a broadly positive footing, though investors will keep a close eye on the stalled Iran-U.S. peace talks.
The U.K.'s FTSE index is among the benchmarks under observation as sentiment shifts from the Asian session to European trading hours.