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BANGKOK – Asian markets presented a mixed picture on Friday, as significant investments in artificial intelligence and the possibility of a U.S.-Iran confrontation created unease among investors, impacting key indices.
While U.S. futures showed a slight uptick, oil prices continued their upward trend. The rise in crude prices is driven by escalating tensions, with both the United States and Iran indicating readiness for conflict should negotiations over Iran’s nuclear activities collapse.
In Tokyo, the Nikkei 225 index declined by 1.2%, settling at 56,797.22. This dip was largely due to concerns over financial institutions and banks, which are wary of the potential fallout from weakening private credit companies that have invested in sectors vulnerable to disruption from AI technologies.
Among those affected is Mitsubishi UFJ Financial Group, a prominent player in the market with ties to Blue Owl Capital, a private credit firm. Following a 5.9% drop in Blue Owl’s shares on Thursday, MUFJ saw its own shares fall by 2.6% in Tokyo trading.
Major corporations like Toyota Motor Corp. and Sony also experienced declines, with their shares dropping 3.9% and 3.3% respectively.
In Hong Kong, the Hang Seng lost 0.6% to 26,544.62 as the market reopened following Lunar New Year holidays. Markets in mainland China and Taiwan remain closed until next week.
South Korea’s Kospi jumped 2.2% to 5,803.40, however, led by major defense contractors like Hanwha Aerospace, whose shares soared 8.6%. The company is one of many benefiting from a ramp up in military spending in many countries.
Elsewhere in the region, Australia’s S&P/ASX 200 edged 0.1% lower to 9,075.70.
India’s Sensex added 0.2%, and the SET in Bangkok lost 0.7%.
On Thursday, the S&P 500 slipped 0.3% to 6,861.89. The Dow Jones Industrial Average dropped 0.5% to 49,395.16, and the Nasdaq composite lost 0.3% to 22,682.73.
Booking Holdings dropped 6.1% for one of the market’s sharper losses, even though the company behind the Booking.com, Priceline and OpenTable brands reported a profit for the latest quarter that edged past analysts’ expectations.
It is one of many companies under pressure because of worries that competitors powered by artificial-intelligence technology could upend its industry and take away customers. Booking’s stock has lost roughly a quarter of its value so far this year already.
Carvana sank 7.9% even though the retailer reported a stronger profit for the latest quarter than analysts expected.
Walmart, meanwhile, pushed and pulled on the market after jumping to an early gain of 2.7% and then flipping to a loss of 1.4%. The retail giant delivered stronger results for the latest quarter than analysts expected, but it gave a profit forecast for the upcoming year that fell short of estimates.
Some of the bigger gains in the S&P 500 came from stocks of oil companies, which climbed with the price of crude. A barrel of benchmark U.S. crude rose 1.9% to $66.43, while Brent added 1.9% to $71.66 per barrel.
Early Friday, U.S. benchmark crude was up 29 cents at $66.69 per barrel. Brent, the international standard, gained 30 cents to $71.96 per barrel.
Occidental Petroleum jumped 9.4% after it also reported a stronger profit for the latest quarter than analysts expected.
Higher oil prices could lead the Federal Reserve to hold off on cuts to interest rates. Fed officials said at their last meeting that they want to see inflation fall further before they would support cutting rates further this year.
On the other hand, a report saying the number of U.S. workers applying for unemployment benefits eased could signal the pace of layoffs is slowing.
Other U.S. economic reports said that growth for manufacturing in the mid-Atlantic region is accelerating, but potential The U.S. trade deficit also widened in December by more than economists expected.
In other dealings early Friday, the dollar rose to 155.24 Japanese yen from 154.99 yen. The euro slipped to $1.1752 from $1.1775.
The price of gold rose 0.5% and the price of silver was up 0.8%.
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AP Business Writers Matt Ott and Stan Choe contributed.
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