CANBERA (dpa-AFX) - Asian markets ended mostly lower on Friday, though South Korean equity benchmark rose to a record amid expectations that upcoming investor-friendly measures will boost shareholder returns and lift market valuations.
Regional sentiment was fragile amid escalating U.S.-Iran tensions, risks linked to massive investments in artificial intelligence and fresh concerns about the health of the U.S. private credit sector.
Gold edged above $5,000 an ounce in Asian trade but was set for a weekly decline as the dollar surged to a one-month high ahead of the release of U.S. GDP and PCE inflation data.
Oil rose to its highest level since August on rising geopolitical risks after U.S. President Donald Trump warned Tehran that it had a 'maximum' 15 days to reach a deal with the U.S. or 'bad things will happen'.
Mainland Chinese markets remained shut for the Lunar New Year holidays. Hong Kong's Hang Seng fell 1.10 percent to 26,413.35 as traders retuned from the holiday break.
Japanese markets lost ground as U.S.-Iran tensions escalated and investors waited for key U.S. economic releases that could shape expectations for Fed policy.
The yen weakened as data showed Japan's key inflation gauge eased to the slowest pace in two years, dampening bets on a Bank of Japan rate hike.
Separately, flash PMI data from S&P Global revealed that Japan's private sector activity expanded at the quickest pace since May 2023 in February.
The Nikkei average fell 1.12 percent to 56,825.70 while the broader Topix index settled 1.13 percent lower at 3,808.48.
Sumitomo Pharma plummeted 15.6 percent after securing conditional approval for its regenerative therapy. Mitsubishi Electric rallied 2.1 percent after the company announced significant organizational and management changes.
In Seoul, the Kospi average jumped 2.31 percent to 5,808.53, breaching the 5,800-point mark for the first time to hit a fresh record high led by chip and defense shares.
Australian markets finished marginally lower to snap a four-session winning run after touching a record on Thursday.
Across the Tasman, New Zealand's benchmark S&P/NZX-50 index fell 1.01 percent to 13,308.52.
Overnight, U.S. stocks ended modestly lower as U.S.-Iran tensions escalated, AI disruption worries persisted, Walmart's outlook fell short of analyst estimates and Blue Owl Capital restricted investor redemptions from one of its retail debt funds, raising concerns about potential losses in the private credit market.
The Dow dipped half a percent while the tech-heavy Nasdaq Composite and the S&P 500 both fell around 0.3 percent.
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