(Sharecast News) - Asia-Pacific markets fell on Thursday, tracking overnight losses on Wall Street, as renewed tensions between Iran and the US kept investors on edge and fuelled concerns that elevated energy costs could keep inflation sticky.
"Global equities have pulled back from record highs as a disappointing Broadcom forecast challenged the AI momentum that has carried markets through much of the year," said Patrick Munnelly, market strategy partner at TickMill.
"Asian equities snapped a four-day winning streak, with the MSCI regional index down 1.2%, while Korea's KOSPI fell 1% after being one of the standout global performers."
The Kuwait International Airport was struck by Iran early Wednesday, a day after US Central Command said it had defeated multiple Iranian ballistic missiles and drones and launched "self-defense strikes" on Qeshm Island in the Persian Gulf in response to "attempted attacks" by Tehran.
Israeli prime minister Benjamin Netanyahu told CNBC in an exclusive interview that Israel and the US were prepared to strike Iran again if necessary.
"Israel is ready and the US forces are ready. I think Iran should take that into account. I think they are taking into account, but they're playing with fire," he said.
Oil prices eased despite the renewed tensions, with Brent crude futures last down 1.46% on ICE at $96.38 per barrel, and the NYMEX quote for West Texas Intermediate falling 1.28% to $94.79.
Munnelly said the tone contrasted with the previous session, when equities managed to rally despite renewed US-Iran and regional missile activity.
"That shift says something important about the market's current hierarchy of drivers," he said.
"Middle East headlines still matter for oil and bond yields, but AI and tech earnings are now driving equity sentiment.
"The Israel-Lebanon ceasefire has helped cool the three-day surge in crude, with Brent slipping toward $97 per barrel, but the agreement is dependent on a "complete cessation" of violence by Hezbollah and is not being treated as a decisive de-escalation."
Stocks fall across the region
Japan's Nikkei 225 fell 1.36% to 67,470.69, while the broader Topix declined 1.11% to 3,951.85.
SoftBank Group dropped 11.28%, Ibiden lost 8.14%, and Toppan Holdings fell 6.77%.
In China, the Shanghai Composite slipped 0.64% to 4,057.78, while the Shenzhen Component declined 0.27% to 15,661.57.
Jiangsu King's Luck Brewery fell 9.26%, Aluminum Corp of China lost 9.24%, and Joeone Co dropped 8.88%.
Hong Kong's Hang Seng Index fell 1.48% to 25,253.40.
Contemporary Amperex Technology declined 7.01%, CMOC Group lost 6.91%, and AIA Group fell 6.75%.
South Korea's Kospi 100 dropped 2.07% to 10,804.19.
LG Electronics tumbled 16.43%, NCsoft lost 14.35%, and SK Telecom declined 13.02%.
Sydney, Wellington in the red as well
Heading down under, Australia's S&P/ASX 200 fell 1.13% to 8,686.10.
Paladin Energy dropped 8.19%, Summerset Group Holdings lost 6.89%, and Block Inc declined 6.42%.
Australia posted a trade surplus of AUD 1.79bn in April, swinging from a downwardly revised AUD 1.02bn deficit in March and matching market expectations.
Exports rose 7.2% month on month to a three-year high of AUD 47.19bn, after a downwardly revised 2.5% fall in March, driven by a sharp increase in metal ores and minerals amid supply concerns and higher energy costs.
Imports rose 0.8% to AUD 45.40bn, following a downwardly revised 12.2% surge in March.
Across the Tasman Sea, New Zealand's S&P/NZX 50 slipped 0.1% to 13,101.61.
Serko fell 3.69%, A2 Milk Company lost 2.88%, and Stride Property declined 2.63%.
Dollar weaker against regional peers
In currencies, the dollar was last down 0.13% on the yen to trade at JPY 159.86, as it slipped 0.01% against the Aussie to AUD 1.4025, and declined 0.13% on the Kiwi to change hands at NZD 1.7040.
Reporting by Josh White for Sharecast.com.
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