Hong Kong stocks closed lower Monday as the fallout from the ongoing conflict in the Middle East reverberated across markets and oil crossed the $100 mark.

The Hang Seng Index fell by around 348.83 points, or roughly 1.4%, to end at 25,408.46, while the Hang Seng China Enterprises Index fell by 46.67 points, or a little over 0.5%, to close at 8,581.46.

The price of Brent oil has soared to over $100 per barrel following U.S.-Israeli strikes on Iran and Tehran's retaliatory actions across the Middle East, causing equities across Asia to slip due to a surge in fuel prices amid already weak economic prospects, reducing risk appetite.

Meanwhile, economists raised their forecast for Hong Kong's economic growth in 2026, citing stronger financial activity and support from the government's latest budget, according to a Bloomberg survey.

The median estimate sees GDP expanding 2.9% this year, up from 2.5% in a survey conducted a quarter earlier, Bloomberg reported.

In corporate news, only one of the three companies that made their market debut finished higher on the first day of trading.

Shenzhen Zhaowei Machinery & Electronics (HKG:2692; SHE:003021) closed at HK$73 per share, up 2.4% from its IPO price of HK$71.28.

ALSCO Pooling Service (HKG:2649) ended at HK$6.20 per share, below its offer price of HK$11.

Chinese industrial robotics maker Estun Automation (HKG:2715, SHE:002747) ended at HK$12.90, down 16% from its listing price of HK$15.36 per share.