Stock markets in Asia experienced declines on Tuesday, while oil prices retreated after a significant surge the previous day, remaining above $100 per barrel.

This situation was largely attributed to ongoing hostilities between the US and Iran, which have intensified over control of the Strait of Hormuz, a critical energy trade chokepoint.

The heightened tensions cast doubt on the fragile truce previously in place.

Investors were also keeping a close eye on the Japanese yen due to its unexpected strength the previous session, sparking speculation that Tokyo may intervene to stabilize the currency.

Consequently, EUROSTOXX 50 futures and FTSE futures saw decreases of 0.3 percent and 1 percent respectively, while DAX futures declined by 0.4 percent.

In Asia, MSCI's broadest index of Asia-Pacific shares outside Japan encountered a 0.6 percent drop due to thin trading, with markets in Japan and South Korea being closed for holidays.

The Hang Seng Index in Hong Kong experienced losses exceeding 1 percent, while China's CSI300 blue-chip index remained relatively unchanged.

Both the US and Iran launched additional attacks in the Gulf on Monday, engaging in a form of maritime blockade as they vie for control over the strategic waterway.

This development served as a stark reminder that the Middle Eastern conflict remains unresolved despite attempts at resolving it through 'Operation Freedom', which aimed to facilitate the passage of ships through the Strait.

Oil markets reacted negatively to these developments, with Brent crude futures falling 1.3 percent to $112.93 per barrel and US crude prices decreasing by 2.3 percent to $104 per barrel.

This downturn was a consequence of heightened concerns regarding supply disruptions caused by geopolitical tensions.

Investors are also anticipating the release of earnings reports this week, with major companies such as Advanced Micro Devices and Pfizer expected to disclose their financial results.

According to data from S&P Global Market Intelligence, 83 percent of S&P 500 companies that have already reported earnings have exceeded expectations in terms of earnings per share, while 78.2 percent have surpassed revenue estimates.

Despite the negative market trends, Nasdaq futures showed a slight increase of 0.26 percent and S&P 500 futures rose by 0.17 percent following their declines in the overnight cash session.

This suggests a cautious optimism regarding future market performance.

Additionally, market participants are closely observing potential intervention by Japanese authorities in the foreign exchange market to support the yen's value.

The yen temporarily appreciated against the dollar on Monday, reaching an intraday high of 155.69.

Japanese Finance Minister Satsuki Katayama has spoken out against speculative trading in foreign currencies, indicating a possibility of further intervention.

The Australian dollar experienced a minor decline of 0.08 percent, trading at $0.7162, following the Reserve Bank of Australia's decision to raise interest rates for the third time this year.

Meanwhile, the US dollar strengthened on account of safe-haven demand.

The Federal Reserve's monetary policy outlook may be influenced by various economic data releases scheduled for this week, including April's nonfarm payrolls report.

Market expectations suggest that the Fed will maintain its current policy interest rate for the remainder of the year due to ongoing inflationary pressures stemming from global energy shocks.

Elsewhere, gold prices rose by 0.3 percent, reaching $4,533.68 per ounce, reflecting a cautious approach amidst the market volatility.