Today's stock market: the tension in the Middle East is escalating, Asian stock markets follow the Wall Street downtrend

HONG KONG (AP) - Asian stocks fell on Monday as fears of a possible escalation of tensions in the Middle East rocked financial markets, prompting investors to seek safer places for their money.

Despite the tensions gripping the Middle East, where an attack late Saturday marked Iran's first military attack on Israel - a country with decades of animosity dating back to the 1979 Islamic Revolution - U.S. futures rose and oil prices fell.

A barrel of benchmark U.S. crude fell 41 cents to $85.25 a barrel. The international standard Brent crude oil fell 24 cents to $90.21. Oil prices were subdued by a slowdown in demand from China and forecasts of supply growth outstripping demand.

"While the drone attack has dominated the headlines, its immediate impact on global markets, particularly oil prices and inflation concerns," said Stephen Innes, executive郃 partner at SPI Asset Management in a commentary may be subdued." The precision of Iran's response and the limited lethal impact suggest a strategic approach aimed at minimizing damage rather than exacerbating tensions.

Japan's benchmark Nikkei 225 index fell 1% to 39,114.19 points in morning trade.

In currency trading, the U.S. dollar rose to a 34-year high of 153.71 yen from 153.07 yen as investors turned to the traditional safe-haven currency. The euro rose to $1.0650 from $1.0635.

Australia's S&P/ASX 200 index fell 0.6% to 7,743.80 points. Korea's Kospi fell 1.1% to 2,653.06.

Hong Kong's Hang Seng Index fell 0.5% to 16,633.37, while Shanghai's Composite Hex Index rose 1.4% to 3,062.73. Elsewhere in Asia, Taiwan fell 1% and India's Sensex was down 1% as India prepares for a long national election process.

Prior to Monday's decline, Wall Street was also down on Friday as earnings season got off to a mixed start.

The S&P 500 fell 1.5% to 5,123.41 on Friday, ending its worst week since October, when Wall Street began its sharp rebound. The Dow Jones Industrial Average fell 1.2% to 37,983.24, while the Nasdaq Resonance Composite Index dropped 1.6% to 16,175.09 from a record set the day before.

JPMorgan Chase, one of the market's top heavyweights, fell 6.5% even though its profit for the first three months of the year was better than analysts had expected.The nation's largest bank's forecast for its main revenue streams this year was lower than Wall Street's expectations, with only a small increase in growth.

Companies have always been under pressure to increase profits. But that pressure is particularly acute now amid concerns that interest rates, another major lever in determining share prices, may not rise much in the near term.

A series of reports this year suggest that inflation and the overall economy remain hotter than expected. This has forced traders to scale back their forecasts for how many times the Fed may cut key interest rates this year. According to CME Group (CME Group), traders are mostly betting on only two rate cuts, down from at least six forecasts at the beginning of the year.

U.S. stock indexes have reached record highs, in part because of expectations of interest rate cuts. If interest rates are not eased, companies will need to generate greater profits to justify the price of their shares, which critics say are too expensive by all measures.

Meanwhile, bond yields in the bond market have fallen and the price of gold has risen, typical of investors flocking to what is perceived to be a safer investment.

The 10-year Treasury yield fell to 4.51% from 4.58% late Thursday.

A preliminary report shows that U.S. consumer sentiment is slipping, adding to market nervousness. This is an important update, as U.S. consumer spending is the main driver of the economy.

Perhaps more worryingly, US consumers may be even more pessimistic about inflation. Their forecast for inflation over the next 12 months is at its highest level since December. Such expectations could lead to a self-fulfilling prophecy that buying goods before prices rise will only fuel inflation.