Asian equities gave up initial advances on Thursday as investor sentiment weakened following media reports that the U.S. has intercepted at least three Iranian-flagged oil tankers in Asian waters, redirecting them away from positions near India, Malaysia and Sri Lanka. The moves came after Iran\u2019s navy said it had seized two container ships in the Strait of Hormuz.<\/p>\n
Japan\u2019s Nikkei 225 briefly touched an all-time intraday high of 60,013.98 before slipping 1.20% on profit taking. Japan\u2019s manufacturing activity expanded at its fastest pace in four years in April, underpinning earlier optimism. South Korea\u2019s Kospi also reached a record intraday high of 6,538.72 but ended the session down 0.74%. The South Korean economy grew 1.7% in the January\u2013March quarter from the previous three months, exceeding Reuters\u2019 estimates of 1.0% and marking the fastest growth since the third quarter of 2020.<\/p>\n
Elsewhere in the region, mainland China\u2019s CSI300 index fell 0.79%, Hong Kong\u2019s Hang Seng index declined 1.12%, and India\u2019s Nifty50 lost 0.62%.<\/p>\n
The shift in risk sentiment followed U.S. President Donald Trump\u2019s decision on Tuesday to extend a two-week U.S. ceasefire with Iran. Trump said the extension was warranted due to what he described as Tehran\u2019s \u201cseriously fractured\u201d government. The ceasefire will remain in place until Iran submits a proposal or talks conclude, while the U.S. military continues its blockade of Iranian ports. However, the timeline for negotiations remains unclear.<\/p>\n
Iranian state media reported on Wednesday that Tehran\u2019s negotiators would not attend talks with the U.S., calling them a \u201cwaste of time.\u201d A reported lack of commitment from Iran prompted Vice President JD Vance to pause his trip to join peace discussions.<\/p>\n
Oil prices extended gains amid the heightened tensions. West Texas Intermediate futures rose 1.60% to $92.96 per barrel, while Brent crude added 1.28% to $101.91 per barrel.<\/p>\n
Asian trading followed a strong lead from Wall Street. During Wednesday\u2019s regular session, the S&P 500 added 1.05% to close at 7,137.90. The tech-heavy Nasdaq rose 1.64% to 24,657.57, and the Dow Jones Industrial Average advanced 340.65 points, or 0.69%, to finish at 49,490.03.<\/p>\n
What triggered the reversal in Asian stock markets?<\/strong> How did Japan and South Korea\u2019s markets perform?<\/strong> What was the reaction in oil prices?<\/strong> What action did President Donald Trump take regarding Iran?<\/strong>
Asian markets reversed early gains after reports that the U.S. military intercepted at least three Iranian-flagged oil tankers in Asian waters, increasing uncertainty around the duration and trajectory of the Middle East conflict.<\/p>\n
Japan\u2019s Nikkei 225 briefly hit a record intraday high of 60,013.98 before closing down 1.20%, while South Korea\u2019s Kospi reached an all-time intraday high of 6,538.72 and then ended 0.74% lower.<\/p>\n
Oil prices extended gains, with West Texas Intermediate futures up 1.60% to $92.96 per barrel and Brent crude rising 1.28% to $101.91 per barrel.<\/p>\n
President Donald Trump extended a two-week U.S. ceasefire with Iran, stating it would remain in place until Iran submits a proposal or talks conclude, while maintaining a U.S. military blockade of Iranian ports.<\/p>\n