Iran rules out direct ceasefire negotiations, reviewing U.S. proposals; Asian stock markets show mixed performance

Investing.com - On Thursday, Asian stock markets fluctuated within a narrow range and declined as the market interpreted mixed signals about the potential de-escalation of the US-Israel conflict with Iran. A rebound in oil prices also added pressure.

Despite positive overnight moves on Wall Street, most Asian markets were not buoyed, as Iran stated it was reviewing the US ceasefire proposal but had no intention of negotiating.

By Wednesday, major US stock indices closed well below their intraday highs. As of 10:15 PM Eastern Time (2:15 AM Beijing Time), the S&P 500 futures were down 0.1%.

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South Korea and Hong Kong Lead Declines; Mixed Signals on Iran War

South Korea’s KOSPI index was the worst performer in Asia, falling 2.8%, while Hong Kong’s Hang Seng index declined 1.4%.

Asian markets were hit by ongoing uncertainty surrounding the Iran conflict, especially after Iran indicated it was not interested in direct ceasefire negotiations with Washington.

The war has entered its fourth consecutive week with little sign of de-escalation. Hostilities between Iran, the US, and neighboring Middle Eastern countries continue.

Iran also continues to effectively blockade the Strait of Hormuz, cutting off about 20% of global oil and natural gas supplies.

On Wednesday, markets briefly gained some relief after the US sent Iran a 15-point ceasefire proposal. Tehran initially rejected the proposal but later said it would review the measure.

Iran also proposed its own five-point ceasefire plan.

However, Asian markets are digesting weeks of losses and remain concerned about the economic impact of the war. Several Asian economies, heavily reliant on imports, are seen as highly vulnerable to disruptions in energy markets.

Japanese Stocks Turn Lower; Tokyo Begins Releasing Oil Reserves

The Nikkei 225 and Topix indices in Japan fell 0.2% and 0.6%, reversing earlier gains.

Local media reported that Japan has begun releasing oil from the national emergency reserves to help offset supply disruptions caused by the Iran conflict.

Prime Minister Sanae Takaichi earlier this week announced that Tokyo would release about 8 million barrels of reserve oil to local refineries.

This release comes amid similar measures by several major global economies, aiming to ease energy supply shocks from the Iran war.

Inflation concerns remain a key focus for markets, with growing worries that energy-driven inflation could disrupt economic growth and trigger more hawkish monetary policies.

Several major central banks, including the Reserve Bank of Australia and the Bank of Japan, warned earlier in March about the inflationary impact of the conflict.

In other Asian markets, Australia’s ASX 200 declined 0.2%, while China’s CSI 300 and Shanghai Composite both fell about 0.3%.

The Singapore Straits Times Index performed slightly better, rising 0.4%.

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