Stocks mostly decline as Iran war standoff pushes oil prices higher

HONG KONG: World shares were mostly lower while oil prices pushed higher on Friday as talks on ending the war between the US and Iran remained stalled.

US futures also wavered after Wall Street pulled back from its all-time highs. The future for the S&P 500 edged 0.1 per cent higher, while that for the Dow Jones Industrial Average lost 0.2 per cent.

In early European trading, Germany's DAX lost 0.2 per cent to 24,106.17, and the CAC 40 in Paris dropped 1 per cent to 8,147.70. Britain's FTSE 100 sagged 0.6 per cent to 10,397.64.

During Asian trading, Tokyo's Nikkei 225 gained 1 per cent to 59,716.18, led by heavy buying of technology stocks. On Thursday, it hit a record intraday high above 60,000.

Hong Kong's Hang Seng reversed earlier losses to add 0.2 per cent, closing at 25,978.07, while the Shanghai Composite index edged 0.1 per cent lower to 4,079.90.

South Korea's Kospi closed nearly unchanged at 6,475.63.

In Australia, the S&P/ASX 200 declined 0.1 per cent to 8.786.50.

Taiwan's Taiex jumped 3.2 per cent as computer chipmaker TSMC, which makes up a key part of the index, gained 5.1 per cent.

India's Sensex lost 1.4 per cent.

Progress on another round of peace talks between the United States and Iran was limited even after President Donald Trump said on Tuesday that the US was indefinitely extending a two-week ceasefire with Iran, a day before it was originally set to expire.

The Strait of Hormuz, a key passageway for global energy where roughly a fifth of the world's oil and natural gas normally passed through before the war, remains largely closed, and a US sea blockade of Iranian ports is still in effect. After the US imposed a blockade on Iranian ports last week, Iran attacked three ships in the strait on Wednesday and seized two of them.

Trump said on Thursday that the US military was intensifying its mine-clearing efforts in the strait, and he ordered the military to “shoot and kill” small Iranian boats laying mines in the area.

Oil prices have remained elevated since the Iran war began on February 28.

The price for a barrel of Brent crude to be delivered in June rose 3.1 per cent on Thursday to settle at USD 105.07 and at one point topped USD 107. The price for a barrel of Brent to be delivered in July, which is the more popular contract for traders, settled at USD 99.35 after rising as high as USD 101.

Early Friday, Brent crude was up 98 cents at USD 100.33 a barrel. US benchmark crude picked up 81 cents to USD 96.66 per barrel.

The global energy shock caused by the Iran war has threatened to worsen inflation in many countries and shaken world markets. But Wall Street has still hit record highs, helped by strong corporate earnings and some optimism that the war will end soon.

On Thursday, the benchmark S&P 500 dropped 0.4 per cent, halting a week-long rally that lifted it to new all-time highs. The Dow industrials also declined 0.4 per cent, while the technology stocks-heavy Nasdaq composite dropped 0.9 per cent.

Shares of Tesla sank 3.6 per cent, dragging the market lower despite strong-than-expected quarterly results as investors focused on a big jump in capital expenditures as the company pivots towards artificial intelligence and robotics.

Paramount Skydance lost 4.5 per cent, following approval by Warner Bros. Discovery's shareholders of its merger with Paramount. Shares of Warner Bros. Discovery fell 1.6 per cent.

In other dealings early Friday, the US dollar rose to 159.74 Japanese yen from 159.71 yen. The euro was trading at USD 1.1687, down from USD 1.1683.