Asian stocks ended mixed on Wednesday ahead of the US Federal Reserve's interest-rate decision under Chairman Kevin Warsh later in the day and Friday's signing of the US-Iran interim peace agreement.
The signing of the Memorandum of Understanding in Switzerland is likely to pave the way for a 60-day negotiating period to address key issues that have plagued US-Iran diplomacy for decades.
The framework may rapidly unlock Iranian oil exports, channel funds into its economy, and begin a phased rollback of sanctions in exchange for nuclear curbs.
Meanwhile, the Fed is seen holding rates steady today despite concerns over persistent inflation. With investors focused on macroeconomic conditions and policy direction, all eyes will be on Kevin Warsh's first FOMC press conference.
The dollar eased in Asian trading, and gold was little changed at $4,330 an ounce while Brent crude futures fell toward $78 a barrel on optimism for an end to the US-Iran war and a possible reopening of the Strait of Hormuz, crucial for oil and gas transit worldwide.
China's Shanghai Composite index edged up by 0.4% to close at 4,108.08 after a choppy session.
Hong Kong's Hang Seng index fell 0.74% to 24,312.16. HSBC shares rallied 1.4% after the lender announced it would use Google Cloud to roll out artificial intelligence across its global operations.
Japanese markets advanced as data showed Japan's exports grew at their fastest pace since November 2022 in May, helped in part by strong demand for cars and high-tech products.
Additionally, core machinery orders jumped 8.7% in April, beating forecasts and pointing to steady capital spending.
The Nikkei average surged 0.72% to 69,902.25, closing at a record high for a third straight session. The broader Topix index closed 0.55% higher at 4,013.23.
Seoul stocks ended higher for a fifth consecutive session as falling oil prices tempered inflation concerns. The Kospi index rallied 1.58% to 8,864.24, driven by gains in technology stocks.
While market bellwether Samsung Electronics rose about 1%, SK Hynix soared 5.8% to set a new record.
Australian markets closed at a two-month high, with banks and miners leading the surge. The benchmark S&P/ASX 200 rose 0.54% to 8,966.30 while the broader All Ordinaries index surged 0.60% to 9,185.90.
Across the Tasman, New Zealand's benchmark S&P/NZX-50 index dropped 0.25% to 13,392.98, erasing gains from the previous session ahead of the release of Q1 GDP data.
Overnight, US stocks ended mixed as markets waited for the U.S.-Iran peace deal to be finalized. The narrower Dow gained 0.6% to reach a new record closing high on eased inflation and rate worries after US officials indicated that the interim peace deal will reopen the Strait of Hormuz to commercial traffic without tolls by Friday.
Yields on Treasuries fell, and oil prices remained close to three-month lows after the Wall Street Journal reported that the United States will allow Iran to immediately resume oil exports, marking a significant shift in sanctions policy.
The tech-heavy Nasdaq Composite fell 1.2%, and the S&P 500 gave up 0.6%, weighed down by losses in chip stocks.
