Asian stock markets turned lower on Thursday, reversing morning gains in a session marked by volatility as geopolitical risk stemming from U.S.-Iran tensions outweighed positive earnings and economic data.
Markets had opened higher, following gains on Wall Street where the S&P 500 and the Nasdaq closed at fresh record highs after President Donald Trump extended a ceasefire with Iran. Those overnight moves failed to hold, however, as investors weighed renewed threats to global oil supply after incidents in the Strait of Hormuz.
U.S. stock index futures were softer during Asian hours, reflecting the more cautious tone among investors in the region.
Japan and South Korea: Peaks and pullbacks
Japan's Nikkei 225 retreated 1.1% to 58,952.1 points late in the session, after earlier climbing to a record intraday high of 60,198.0 points. In South Korea, the KOSPI slipped 0.5% to 6,384.29 points, giving back ground from an earlier peak of 6,557.76 points that had been supported by gains in technology names.
Chipmakers played a central role in the earlier rally. SK Hynix Inc (KS:000660) reported blockbuster first-quarter results, with operating profit rising more than five-fold year-on-year. The company attributed the surge to strong demand for high-bandwidth memory and other chips used in artificial intelligence applications, as global technology firms scale up data centre investments. SK Hynix shares eased after hitting a record high in early trading.
Samsung Electronics (KS:005930) also featured prominently, with its stock climbing 2.3% during the session.
Domestic economic data provided further support for sentiment in South Korea: gross domestic product expanded 1.7% quarter-on-quarter in the first quarter, outpacing forecasts of around 0.9%, while annual growth accelerated to about 3.6%, well above expectations.
Geopolitical tensions and oil market stress
Despite the ceasefire extension announced by President Trump, sentiment remained fragile as oil prices stayed above $100 per barrel and near recent highs. Supply through the Strait of Hormuz remained halted after Iran seized two commercial vessels on Wednesday, an act that occurred just hours after the ceasefire announcement and underscored the fragility of the truce.
That disruption to one of the world's key oil chokepoints contributed to the retreat in regional equities.
Broader regional moves
China's Shanghai Composite and the blue-chip Shanghai Shenzhen CSI 300 each fell 0.5%, while Hong Kong's Hang Seng index declined 1%. Australia's S&P/ASX 200 and Singapore's Straits Times Index each slipped about 1%. Futures tied to India's Nifty 50 index were down 0.7%.
Overall, the trading day highlighted the push-and-pull between supportive headlines from technology earnings and economic growth data, and downside pressure from renewed geopolitical risks and elevated oil prices.