TOKYO (AP) - Asian shares saw mixed trading early Tuesday as optimism from a record rally on Wall Street met resistance from rising oil prices and concerns over a potential AI bubble. Japan's Nikkei 225 index saw a gain of 0.7%, closing at 62,881.03, while South Korea's Kospi fell by 1.2% to 7,726.30, as analysts described the decline as a consequence of overdependence on waning AI expectations.
According to Stephen Innes, an analyst at SPI Asset Management, the current global equities market is precariously reliant on a small group of AI leaders. This creates a rally that appears strong on the surface but is fundamentally fragile. He suggested that South Korea might experience the initial impact of what he termed "the political redistribution phase of the AI boom."
In Australia, the S&P/ASX 200 index dropped by 0.3% to 8,676.60, while Hong Kong's Hang Seng index managed a modest gain of 0.2%, closing at 26,467.50. Conversely, the Shanghai Composite saw a downturn of 0.4%, finishing at 4,208.00.
As oil prices continued on an upward trajectory, concerns about the ongoing war in Iran persisted. Benchmark U.S. crude saw an increase of 91 cents, trading at $98.98 per barrel, while the Brent crude, the global benchmark, rose by 90 cents to reach $105.11 per barrel.
Additional worries arose from statements made by President Donald Trump, who indicated that the U.S.-Iran ceasefire was "on life support" following the rejection of Iran's latest peace proposal. This situation raises the stakes for Trump’s upcoming trip to China, which is the largest buyer of Iran’s sanctioned crude oil.
This ongoing conflict has already propelled the price of Brent crude significantly higher than pre-war levels, which were around $70, and has contributed to inflation across the global economy. The war has also closed the Strait of Hormuz, leading to disruptions in oil tanker deliveries from the Persian Gulf to global markets.
Despite these tensions, some companies are reporting profits that exceed analysts' expectations, indicating that the U.S. economy is maintaining stability, even as households contend with higher gasoline prices and tariffs that are discouraging consumer confidence.
On Wall Street, the S&P 500 added 0.2% to surpass its previous all-time high from Friday. The Dow Jones Industrial Average climbed 95 points, or 0.2%, while the Nasdaq composite increased by 0.1% to reach another record high.
Overall, the S&P 500 rose by 13.91 points to close at 7,412.84. The Dow Jones Industrial Average finished at 49,704.47 after adding 95.31 points, and the Nasdaq composite increased by 27.05 points to settle at 26,274.13.
In the bond market, Treasury yields experienced a slight uptick, with the 10-year yield rising to 4.40% from 4.38% at the end of the previous week. In currency trading, the U.S. dollar strengthened against the Japanese yen, increasing to 157.57 yen from 157.12 yen. The euro was traded at $1.1761, down from $1.1787.
AP Business Writer Stan Choe contributed to this report, and Yuri Kageyama is currently active on the social media platform Threads.
