(Sharecast News) - Asia-Pacific markets traded mixed on Friday following a volatile session, as uncertainty around a potential US-Iran peace deal kept investors on edge and supported higher oil prices.
Sentiment remained fragile amid contradictory signals from Washington and Tehran, even as US president Donald Trump extended a deadline to strike Iran's energy infrastructure by 10 days to 6 April to allow more time for negotiations.
As Stephen Innes of SPI Asset Management put it, "The tape is no longer trading outcomes; it is trading hesitation dressed up as strategy."
Trump said the extension was granted at Tehran's request and in exchange for 10 oil tankers passing through the Strait of Hormuz, describing the move as a pause in "Energy Plant destruction" while talks continued.
Washington had signalled a preference for a negotiated outcome, while Iran denied direct talks and reportedly rejected a 15-point US proposal, instead outlining its own conditions including security guarantees and recognition of its authority over the Strait.
Innes said the delay "sounds like breathing room, but in market terms, it feels more like a trader rolling a losing position forward, hoping the next candle delivers what the last one refused to give. Time has been purchased, not clarity. And the market knows the difference."
Tokyo equities fall, China outperforms
In Japan, the Nikkei 225 fell 0.43% to 53,373.07, weighed by declines in Hino Motors, down 5.38%, Daikin Industries, which dropped 5.24%, and ROHM Company, off 4.12%.
The broader Topix edged 0.19% higher to 3,649.69.
Chinese equities outperformed, with the Shanghai Composite rising 0.63% to 3,913.72 and the Shenzhen Component gaining 1.13% to 13,760.37.
Gains were led by Jinzhou Jixiang Molybdenum Co, Guizhou Chitianhua and Shanghai Industrial Development Co, all up around 10%.
Data showed industrial profits in China surged 15.2% year-on-year in January and February, accelerating from a 5.3% increase in December, driven by stronger factory activity and rising product prices.
High-tech manufacturing profits jumped 58.7%, while non-ferrous metals and chemical producers recorded gains of 148.2% and 35.9% respectively.
National Bureau of Statistics official Yu Weining warned that escalating geopolitical tensions could weigh on the outlook, although China's exposure to rising energy prices could be cushioned by large reserves and continued crude imports from Iran.
For 2025 as a whole, industrial profits rose 0.6%, snapping three consecutive annual declines.
Innes said the market was increasingly focused on structural risks, warning that "duration is no longer anchored to growth expectations; it is being pulled by the gravity of energy."
In Hong Kong, the Hang Seng Index rose 0.38% to 24,951.88, supported by gains in CSPC Pharmaceutical Group, up 13.85%, Innovent Biologics, which climbed 7.68%, and China Mengniu Dairy, ahead 5.27%.
South Korean markets were weaker, with the Kospi 100 falling 0.52% to 6,175.57.
Hyosung Heavy Industries declined 6.43%, Hyundai Electric Energy Systems dropped 5.18%, and Samsung Electro-Mechanics fell 5.03%.
Economic data showed mixed signals, with the manufacturing Business Survey Index easing to 71 in March from 72 in February, while production and new orders improved.
However, the Economic Sentiment Index fell to 94.0, down 4.8 points month-on-month, reflecting weaker overall confidence.
Australia, New Zealand in the red
In Australia, the S&P/ASX 200 slipped 0.11% to 8,516.30, led lower by DroneShield, down 13.39%, NextDC, which fell 7.89%, and Codan, off 5.93%.
Across the Tasman Sea, New Zealand's S&P/NZX 50 declined 0.32% to 12,935.39, with Mainfreight down 4.36%, Fonterra Shareholders Fund falling 4.28%, and NZX losing 3.7%.
Consumer confidence in New Zealand dropped sharply, with the ANZ-Roy Morgan index falling to 91.3 in March from 100.1, as uncertainty linked to the Middle East conflict weighed on households.
The share of respondents viewing it as a good time to make major purchases fell 10 points to -14, while expectations for the economy over the next year dropped 17 points to -25%.
Dollar weakens against Pacific counterparts
In currency markets, the dollar was little changed against the yen at JPY 159.89, up 0.05%, while it eased 0.11% on the Aussie to AUD 1.4505 and slipped 0.06% against the Kiwi to change hands at NZD 1.7346.
Oil prices remained elevated, with Brent crude futures last up 2.54% on ICE at $110.75 per barrel, and the NYMEX quote for West Texas Intermediate also up 2.54% at $96.88, as ongoing tensions in the Middle East continued to disrupt energy flows.
Reporting by Josh White for Sharecast.com.
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