Asian Shares Mostly Lower As Oil Extends Rally On Middle East Supply Fears

(RTTNews) - Asian stocks ended mostly lower on Thursday as a sharp rise in oil prices on fears of a prolonged conflict in the Middle East overshadowed stronger-than-expected earnings from major U.S. tech giants.

Sentiment was also shaped by the U.S. Federal Reserve's hawkish hold, as was widely expected, in the most divided FOMC vote since October 1992.

Gold jumped more than 1 percent to trade above $4,600 an ounce in Asian trading after hitting a one-month low in the previous session.

The dollar rose and Brent crude prices for June delivery surged to $122 a barrel after reports that the U.S. is seeking international help to reopen the Strait of Hormuz and that the U.S. Central Command may consider military action against Iran.

China's Shanghai Composite index edged up by 0.11 percent to 4,112.16 after the release of mixed economic data, with the manufacturing sector showing resilience in April while services activity lagged on softer domestic demand.

Hong Kong's Hang Seng index fell 1.28 percent to 25,776.53 on reports the U.S. is preparing to launch a series of strikes on Iran, which would bring an end to a fragile ceasefire.

Japanese markets fell as trading resumed after a public holiday. The Nikkei average tumbled 1.06 percent to 59,284.92 as benchmark government bond yields hit a 29-year high on growing concerns about inflation.

Investors also digested mixed economic readings, with factory output slipping unexpectedly in March on the back of rising costs due to global uncertainties, while retail sales growth showed modest resilience. The broader Topix index settled 1.19 percent lower at 3,727.21.

Seoul stocks ended sharply lower, giving up early gains following strong earnings from Samsung Electronics. The Kospi ended down 1.38 percent at 6,598.87 after briefly rising above the 6,750 mark during intra-day trading.

Samsung shares fell 2.4 percent despite the company reporting its highest-ever quarterly profit, fueled by robust demand for AI-related memory chips.

Australian markets ended slightly lower to extend their losing streak for the eighth day running as the Strait of Hormuz remained effectively closed.

The benchmark S&P/ASX 200 dropped 0.24 percent to 8,665.80 while the broader All Ordinaries index ended down 0.32 percent at 8,887.60.

Woolworths plummeted 7.8 percent after the supermarket giant warned that fiscal 2026 domestic food segment earnings growth would no longer reach the upper end of the guidance range due to the Middle East war and spiking petrol prices.

Across the Tasman, New Zealand's benchmark S&P/NZX-50 index rallied 1.04 percent to 12,903.31 after a survey revealed that the Reserve Bank doesn't need to rush into hiking the Official Cash Rate.

U.S. stocks ended narrowly mixed overnight as oil prices surged to over four-year highs on concerns of an extended blockade of the Strait of Hormuz, and the Federal Reserve kept its key interest rate unchanged for the third consecutive meeting in a split 8-4 vote amid inflation concerns and Middle East tensions.

Treasury yields climbed and oil prices moved near levels last seen in 2022 after reports suggested that President Trump had rejected Tehran's proposal to end the war and instructed aides to prepare for an extended blockade of Iranian ports until the regime agrees to a nuclear deal.

Meanwhile, concluding his final news conference in the role, Fed Chair Jerome Powell said that the energy price surge has not yet peaked and that a prolonged oil shock could intensify its effect on the global economy and monetary policy outlook.

Powell also said he would not leave the Fed board until legal challenges posed by President Trump are "well and truly over."

Cleveland Fed President Beth Hammack, Minneapolis Fed President Neel Kashkari and Dallas Fed President Lorie Logan supported keeping rates unchanged but "did not support inclusion of an easing bias in the statement at this time," signaling a subtle shift toward a more hawkish stance.

While the tech-heavy Nasdaq Composite inched up marginally, the S&P 500 ended flat with a negative bias. The narrower Dow dropped 0.6 percent to extend losses for a fifth consecutive session.