Asian stock markets moved lower on Thursday as investors navigated a confluence of factors that included a dramatic rise in crude oil, divergent reactions to major U.S. technology earnings and a cautious tone from the Federal Reserve.
Wall Street finished largely unchanged overnight, while futures linked to the region's tech-heavy benchmarks were slightly higher during Asian hours. Across Asia, technology names showed mixed performance, mirroring the uneven market responses to results from U.S. megacap companies.
Market movers: oil, earnings and Fed guidance
Oil emerged as a primary influence on sentiment after Brent crude climbed above $120 per barrel amid the ongoing closure of the Strait of Hormuz. The situation around the strait was also the subject of a Wall Street Journal report that said Donald Trump is urging allies to join a "Maritime Freedom Construct" coalition to restore shipping through the strait, while Washington is reportedly preparing for a prolonged blockade. Higher energy costs were cited by policymakers as a driver of inflation risk.
Investor positioning was further affected by the Federal Reserve's decision to keep interest rates unchanged. At his press conference, Chair Jerome Powell - in what is anticipated to be his final appearance as chair - warned that inflation risks remain elevated because of rising energy prices. He also indicated he will remain on the board as a governor.
Regional index moves and corporate results
Japan's Nikkei 225 led headline losses, falling 1.4%, while the broader TOPIX declined 1.5%. Mainland Chinese shares were largely steady, with the Shanghai Composite trading roughly flat, whereas Hong Kong's Hang Seng slipped 1.5%.
South Korea's KOSPI eased 0.2% after earlier climbing to a fresh record high of 6,750.27 points. The advance was spurred by strong results from Samsung Electronics (KS:005930). Samsung's shares themselves rose to a record high on Thursday before reversing some gains; the company reported a record quarterly profit that management attributed to booming demand for AI-linked memory chips.
In the United States, results from the so-called "Magnificent Seven" came through as mixed, though collectively they highlighted continued corporate investment in artificial intelligence.
Economic indicators add nuance
Economic data released across the region offered a mixed picture. Japan reported that factory output fell unexpectedly in March, a sign of fragility in manufacturing activity, even as retail sales growth topped estimates. In China, official statistics showed factory activity expanded for a second consecutive month, with the manufacturing purchasing managers' index remaining above the 50 threshold and supported by stronger exports.
Elsewhere in the region, India's Nifty 50 slipped 1.1%. Singapore's Straits Times Index edged up 0.5%, while Australia's S&P/ASX 200 was down 0.3%.
Going forward, market participants are likely to monitor energy price movements, corporate earnings reactions from major tech groups and incoming economic data for clearer signals on growth and inflation paths in the region.