Asian Shares Mostly Lower As US-Iran Ceasefire Optimism Fades

(RTTNews) - Asian stocks ended mostly lower on Thursday in the face of growing signs of fragility in the two-week ceasefire pact between the United States and Iran in the Middle East.

The Islamic Republic closed the Strait of Hormuz after claiming that several terms of the agreement of the ceasefire proposal had been breached. Iranian Parliament Speaker Mohammad-Bagher Ghalibaf said three clauses of the proposal had been contravened, so far.

U.S. President Donald Trump announced that U.S. forces will remain deployed around the region, warning of strong action if Iran fails to follow ceasefire terms.

As Israel pounds Lebanon, U.S. Vice President JD Vance clarified that Lebanon was never part of the ceasefire agreement.

The dollar remained on a shaky footing in Asian trading and gold prices were little changed above $4,700 an ounce, while Brent crude prices jumped more than 3 percent toward $98 a barrel on doubts about the durability of a fragile Middle East ceasefire.

China's Shanghai Composite index dropped 0.72 percent to 3,966.17 and Hong Kong's Hang Seng index fell 0.54 percent to 25,752.40, with geopolitical tensions and upcoming Chinese inflation data in focus.

Japanese markets ended lower as escalating violence in Lebanon cast doubt on the potential for a lasting peace agreement.

The Nikkei average dipped 0.73 percent to 55,895.32 after rallying 5.4 percent in the previous session. The broader Topix index settled 0.90 percent lower at 3,741.47.

Seoul stocks ended lower on profit taking as Iran continued to flex its control over the vital oil artery, demanding tolls for safe passage.

The Kospi average fell 1.61 percent to 5,778.01 after surging 6.8 percent on Wednesday. Foreign investors led a broad sell-off, with Samsung Electronics and SK Hynix falling over 3 percent each.

Australian markets eked out modest gains, with energy stocks and defensives pacing the gainers. The benchmark S&P/ASX 200 edged up by 0.24 percent to 8,973.20, while the broader All Ordinaries index finished marginally higher at 9,168.90.

Bendigo and Adelaide Bank soared 8.4 percent after posting a rise in Q3 earnings and flagging job cuts.

Across the Tasman, New Zealand's benchmark S&P/NZX-50 index ended up 0.15 percent at 13,273.81, giving up some early gains as disagreements persisted over the scope of the U.S.-Iran truce.

Overnight, U.S. stocks rallied to reach their best closing levels in about a month after the U.S., Israel and Iran agreed to a two-week ceasefire, subject to Tehran agreeing to the complete, immediate and safe opening of the Strait of Hormuz.

Trump said the U.S. has received a 10-point proposal from Iran that he believes is a "workable basis on which to negotiate" and that the two-week ceasefire will allow the agreement to be finalized and consummated.

In economic news, minutes from the Federal Reserve's last policy meeting showed a growing number of members felt a rate hike might be needed in future as inflation rates climb beyond target thresholds.

The Dow spiked 2.9 percent, the tech-heavy Nasdaq Composite surged 2.8 percent and the S&P 500 climbed 2.5 percent.