Asian markets retreat as fresh U.S. strikes on Iran halt Wall Street’s record rally; U.S. inflation looming

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Asian shares declined Thursday morning after U.S. military action in Iran derailed hopes for a near-term peace deal, halting the momentum that drove Wall Street to record highs. Market sentiment remains defensive, with flat U.S. futures reflecting investor caution ahead of key inflation data dropping later today.

Gold prices fell below $4,400 an ounce, hitting a two-month low.

WTI crude futures climbed above $92 per barrel.

Bitcoin (BTC-USD [https://seekingalpha.com/symbol/BTC-USD]) fell to around $74,000 in late May, reaching its lowest level in over five weeks.

The benchmark KOSPI fell more than 1% to around 8,110. The Bank of Korea kept its policy rate unchanged at 2.5% at its May 2026 meeting, in line with expectations and marking the eighth consecutive hold.

Japan's (NKY:IND [https://seekingalpha.com/symbol/NKY:IND]) fell 1.26% to above 65,100, while the broader Topix Index slipped 0.4% to 3,902, and the Japanese yen [https://seekingalpha.com/symbol/USD:JPY#source=url_first_level%3Amarket-news%7Csection%3Amarket-pulse%7Csection_asset%3Afull_story%7Cbutton%3Abody_link] weakened to around 159.5 per dollar. Investors are now awaiting official finance ministry data due Friday that could confirm government action to stabilize the currency.

China's (SHCOMP [https://seekingalpha.com/symbol/SHCOMP]) fell 0.14% to 4,080, marking its third straight decline, while the Shenzhen Component dropped 0.6% to 15,644 for a second consecutive session, and the offshore yuan [https://seekingalpha.com/symbol/USD:CNY#source=url_first_level%3Amarket-news%7Csection%3Aglobal%7Csection_asset%3Afull_story%7Cbutton%3Abody_link]

China will allow eligible coffee bean imports from all 53 African countries with diplomatic ties to enter its market starting July 20, 2026, the General Administration of Customs (GAC) announced.

Hong Kong (HSI [https://seekingalpha.com/symbol/HSI]) fell 2.35% to 24,990, pressured by weakness in financial, technology services, and retail trade stocks.

India (SENSEX [https://seekingalpha.com/symbol/SENSEX]) markets closed.

Australia (AS51 [https://seekingalpha.com/symbol/AS51#hasComeFromMpArticle=false#source=section%3Amain_content%7Cbutton%3Abody_link%7Cfirst_level_url%3Anews]) fell 1.56% to 8,643 in early trade, erasing prior-session gains. The Australian dollar fell to around $0.71, hitting a six-week low. Data showed household spending fell a sharper-than-expected 1.1% in April as consumers cut back on travel, clothing, and food, with higher fuel costs and geopolitical uncertainty weighing on confidence.

Total new capital expenditure in Australia jumped 6.5% quarter-on-quarter in the first quarter of 2026, accelerating from an upwardly revised 0.7% rise in the previous quarter.

Private new capital expenditure on equipment, plant, and machinery in Australia climbed by 18.1% qoq in the first quarter of 2026.

In the U.S. on Wednesday, all three major indexes ended slightly higher [https://seekingalpha.com/news/4597420-wall-street-trades-mixed-as-eyes-remain-focused-on-us-iran-negotiations] as broad gains for traditional sectors clashed against sharp losses for chip producers and AI hyperscalers.

U.S. stock futures traded little changed as investors awaited the latest PCE price index report: Dow -0.22%; S&P 500 -0.42%; Nasdaq -0.87%.

CURRENCIES: (JPY:USD [https://seekingalpha.com/symbol/JPY:USD]), (CNY:USD [https://seekingalpha.com/symbol/CNY:USD]), (AUD:USD [https://seekingalpha.com/symbol/AUD:USD]), (INR:USD [https://seekingalpha.com/symbol/INR:USD]), (HKD:USD [https://seekingalpha.com/symbol/HKD:USD]), (NZD:USD [https://seekingalpha.com/symbol/NZD:USD]).

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* Asian equities mixed after U.S. strikes temper Middle East optimism; KOSPI defies trend to hit record high [https://seekingalpha.com/news/4596684-asian-equities-mixed-after-us-strikes-temper-middle-east-optimism-kospi-defies-trend-to-hit-record-high]