Oil prices fall, Asian shares mostly lower as chip stocks retreat

Oil prices fell and most Asian stocks traded lower Thursday as investors sold shares of major chipmakers, while South Korea’s benchmark Kospi extended its sharp losses.

Oil markets remained volatile after the United States said it had carried out a “heavy wave” of strikes against Iran in response to an attack on a US military base.

US stock futures edged higher after Wall Street ended lower on Wednesday.

In South Korea, the Kospi has come under heavy pressure following a sharp rally driven by the global artificial intelligence boom. Some analysts say the recent sell-off reflects growing concerns about the huge amounts technology companies are spending to expand AI-related capacity.

The Kospi was down 1.3% at 5,587.82 on Thursday after plunging 10.8% Tuesday and nearly 6% Wednesday. It has fallen more than 35% from its record high of above 9,000 reached in June, although it remains about 30% higher so far this year.

Samsung Electronics rose 2.4% after the technology giant reported record operating profit for the latest quarter, broadly matching market expectations.

Chipmaker SK Hynix fell 4% after dropping more than 9% Wednesday. The company reported a record quarterly operating profit that nearly increased sixfold, but the result fell short of analysts’ expectations, prompting investors to sell its shares.

Japan’s Nikkei 225 gained 0.6% to 61,778.02. SoftBank Group, which has invested in OpenAI, dropped 2.7%, while Tokyo Electron, a maker of chip production equipment, climbed 4.4%. Memory chipmaker Kioxia Holdings gained 7.5%.

Taiwan’s Taiex, another major beneficiary of the AI boom, advanced 0.8%, while leading chipmaker TSMC rose 1.8%.

Hong Kong’s Hang Seng index slipped less than 0.1% to 25,779.70, while the Shanghai Composite fell 1.2% to 3,784.55.

Australia’s S&P/ASX 200 declined 0.9% to 8,959.90, while India’s Sensex edged up less than 0.1%.

Oil prices remain volatile
Oil prices fell Thursday despite renewed exchanges of attacks between the US and Iran.

US President Donald Trump said Washington would hit Iran “very hard” after Iranian forces attacked a US base in Jordan. 

Shipping through the Strait of Hormuz, a key route for global oil supplies, remains limited, raising concerns about disruptions to international energy markets.

Brent crude, the international benchmark, fell 1% to $87.18 a barrel after rising sharply the previous day. It was trading at around $72 a barrel in late February, before the war began.

US benchmark crude fell 0.9% to $83.74 a barrel.

US stocks end lower
On Wall Street, the S&P 500 dropped 1.5% to 7,316.15 on Wednesday. The Dow Jones Industrial Average fell 2.2% to 51,594.14, while the tech-heavy Nasdaq composite declined 1.7% to 24,442.94.

Major chipmakers also suffered losses. Nvidia fell 3.6%, Advanced Micro Devices dropped 5.5% and Broadcom declined 2.8%.

US stocks were also pressured after the Federal Reserve kept interest rates unchanged, although some members of its policy committee had favored raising rates.

Fed Chairman Kevin Warsh reaffirmed his commitment to bringing inflation back to the 2% target. At the same time, he maintained his approach of providing financial markets with limited guidance about the central bank’s next interest-rate moves.

With fewer signals from the Fed, investors could face more volatile trading as uncertainty over the direction of interest rates continues.

“Did the Fed take an explicit change in its policy rate today?” Warsh asked at a news conference after the decision. “No, but I think that's the beginning of the story.”

In the bond market, the yield on the 10-year US Treasury note rose to 4.70% from 4.61% late Tuesday. 

In early Thursday trading, the US dollar rose to 163.49 Japanese yen from 163.41 yen. The euro fell to $1.1454 from $1.1467.