BANGKOK — Asian stock markets slipped Friday as trading volumes remained light, with exchanges in Greater China shuttered for holiday celebrations.
U.S. futures moved lower as the initial enthusiasm surrounding a U.S.-Iran deal to end their conflict began to fade. That optimism took a hit after high-level talks aimed at reviving negotiations over Iran’s nuclear program — and restoring oil shipments through the Strait of Hormuz — were pushed back to a later date.
U.S. markets will remain closed Friday in observance of Juneteenth.
Investor confidence has also been rattled by growing expectations that central banks, including the Federal Reserve, will move to raise interest rates in an effort to bring inflation under control.
Japan’s Nikkei 225 index hovered near the flat line, ending little changed at 71,082.81. Government data showed that consumer prices, excluding volatile fresh food items, were flat, though analysts warned that inflation could pick up in the months ahead despite elevated fuel costs.
Inflation concerns were already a driving force behind the Bank of Japan’s decision earlier this week to lift its benchmark interest rate to 1% — a three-decade high — as the central bank continues to gradually shift away from its long-standing policy of near-zero or negative rates.
South Korea’s Kospi index dropped 0.5% to finish at 9,019.22, while Australia’s S&P/ASX 200 fell 1.1% to 8,818.40. India’s Sensex also declined, shedding 1%.
Stock exchanges in Hong Kong, Shanghai, and Taiwan were all closed for the Dragon Boat Festival.
The previous session on Wall Street told a very different story. Stocks climbed Thursday, recovering the bulk of losses suffered the day before and locking in weekly gains, thanks largely to strong performances from major technology companies. Wednesday’s selloff had been fueled by concerns that the Federal Reserve would likely hike interest rates later this year to combat rising inflation.
The S&P 500 gained 1.1%, closing at 7,500.58. The Dow Jones Industrial Average edged up 0.1% to 51,564.70, while the Nasdaq composite jumped 1.9% to reach 26,517.93.
Technology stocks were among the biggest winners and had the greatest influence on the market’s overall rise. Intel soared 10.6% after U.S. President Donald Trump announced the semiconductor company would manufacture chips for Apple domestically. Other chipmakers also saw gains — Nvidia climbed 3% and Micron Technology surged 8.7%.
Not everyone fared as well. SpaceX dropped for the second consecutive session following its high-profile debut on U.S. stock markets last week. The rocket and artificial intelligence company led by Elon Musk fell 3.6%, coming on the heels of a 4.9% loss on Wednesday.
Oil prices were mixed after the United States and Iran signed an agreement to end their conflict and reopen the Strait of Hormuz to oil tanker traffic. Brent crude, the international benchmark, spent most of Thursday in negative territory before finishing the day up 0.4% at $79.85 a barrel. The U.S. benchmark crude slipped 0.2% to $75.85 per barrel.
By early Friday, Brent crude had dipped 0.5% to $79.34 per barrel, while U.S. benchmark crude was down 0.5% at $75.37 per barrel.
Airline stocks posted notable gains. American Airlines climbed 3.7% and United Airlines rose 2.1%. Cruise operator Carnival jumped 3.2%.
Energy companies, however, moved in the opposite direction. Exxon Mobil fell 2.1% and Chevron dropped 2.2%.
While crude oil prices remain higher than the roughly $70 per barrel seen before the war, they have come well down from the $100-plus levels recorded just a few weeks ago.
Elevated oil prices have been a persistent drag on markets throughout the U.S.-Iran conflict. The newly signed agreement between the two nations lifts sanctions on Iran, allowing it to freely sell its oil on global markets, and reopens the Strait of Hormuz — a critical waterway through which approximately one-fifth of the world’s oil supply passes.
Rising energy costs have added further pressure to an already strained inflation environment. The national average price of gasoline has dipped back below $4 per gallon, but still sits about 25% above where it was a year ago. Costs for a broad range of goods have also risen due to higher shipping expenses.
The Federal Reserve held its key interest rate steady this week, but with inflation running hotter than expected, analysts anticipate the central bank will move to raise rates before the year is out. While lower interest rates make it easier for businesses and consumers to borrow and spend — boosting economic growth — they can also fuel inflation over time.
In currency markets early Friday, the U.S. dollar edged up to 161.39 Japanese yen from 161.38 yen. The euro dipped to $1.1441 from $1.1458.
