Asian markets showed mixed performance for the week, with China's Shanghai Composite managing a small 0.1% weekly gain - its first in a month - while the Shenzhen Component dropped 2.3%, marking its third straight weekly decline. According to Business Standard, earlier volatility was driven by US-Iran tensions, but sentiment improved after President Trump suggested a deal with Iran could be reached soon, potentially reopening the Strait of Hormuz. The recovery was aided by hopes for a pause in U.S.-Iran fighting and mild rebound in battered technology shares.
The market decline followed U.S. military strikes in Iran for a second day, as reported by Business Standard. President Trump accused Tehran of delaying peace talks and warned of further action, contributing to the risk-off sentiment in Asian markets. The U.S. said it had struck several military targets in Iran, sparking retaliatory strikes by Tehran against American bases and allies in the Middle East. However, the U.S. military also said it had concluded its strikes against Iran, raising some hopes for a de-escalation. Focus remained on a potential U.S.-Iran peace deal, with President Donald Trump threatening more attacks against the country. Brent crude fell 2.5% to $93.79 per barrel and WTI crude dropped 2.6% to $90.25 during Wednesday's trading session, reflecting broader market concerns about Middle East tensions.
Tech-heavy Asian bourses recovered some ground after initially logging deep losses, with South Korea's KOSPI rising 0.2% and Japan's Nikkei 225 gaining 0.1%. The recovery was driven by a mild rebound in battered technology shares, as investors held out hope for a pause in U.S.-Iran fighting. Chipmaking stocks were the biggest weight on tech this week, as investors locked in gains after a high-flying, artificial intelligence-driven rally in the sector in May. However, the AI rally was seen cooling in June amid persistent doubts over long-term returns from the industry. A Wall Street Journal report showed AI major OpenAI considering deep price cuts amid growing competition from rival Anthropic, which stands to further undermine revenue at a company already neck-deep in losses.
Among individual stocks, Zijin Mining Group gained 7.63%, Zhongji Innolight advanced 8.36%, and Suzhou Dongshan Precision Manufacturing surged 10%, according to Business Standard. The strong performance in mining and manufacturing stocks reflects growing investor confidence in China's industrial sector. However, energy shares lagged the broader market as oil prices declined, with PetroChina falling 2.41% and CNOOC losing 4.62%. Investors also looked ahead to upcoming domestic economic data, including industrial production, retail sales, and unemployment figures, for further clues on China's economic outlook.
On the corporate side, JD.com (HK:9618) fell over 3% after local media reports said the company was facing regulatory scrutiny over allegations of false advertising, according to Investing.com. Other major companies also declined, including China Mobile (-1.34%), Foxconn Industrial Internet (-2.26%), and Zijin Mining Group (-1.34%). The broad-based selling pressure reflected investor concerns about potential economic disruptions from the Middle East tensions. Meanwhile, Oracle stock fell more than 10% in after-hours trading despite reporting better-than-expected results, after the company announced plans to raise $40 billion through equity and debt to fund its AI expansion.
