Asian shares are mixed and US futures advance, while oil prices retreat

Asian shares were mixed and oil prices retreated Monday, falling sharply on renewed hopes for progress in diplomatic efforts between the U.S. and Iran.

U.S. futures advanced after U.S. stocks fell Friday to their worst day since June as investors dumped technology- and artificial intelligence-related stocks.

Japan’s Nikkei 225 gave up early gains, slipping 0.3% to 63,081.86 as some major technology companies fell.

Shares of OpenAI investor SoftBank Group dropped 1.6%. Japanese memory chipmaker Kioxia Holdings plunged 15.8% as its earnings forecasts disappointed some analysts and investors.

South Korea’s benchmark Kospi index rose 2.2% to 5,859.08. Samsung Electronics added 1.8%, while memory chipmaker SK Hynix jumped 3.8%.

Technology stocks have been volatile as investors worry that the AI buildup may prove to be a bubble.

Apple is due to report its latest earnings results later in the day. Last week, earnings reports from Google parent Alphabet Inc. and Amazon rattled markets and raised fresh questions over whether their massive AI-related spending will bring profitable returns as quickly as hoped.

While recent developments do not necessarily mean that the AI boom is beginning to unravel, the debate is entering another phase, Sunil Tirumalai at UBS Global Research wrote in a recent note.

Investors have become “distinctly more nervous about a handful of companies with weaker balance sheets or bigger financial commitments,” he said, rather than the technology sector as a whole.

“Some cracks have appeared,” said Tirumalai. “Increasingly, the question will be whether all the money being spent on it can generate adequate financial returns.”

Over the past month, the Nikkei 225 has fallen more than 7% and the Kospi dropped more than 16%.

Taiwan’s Taiex was 0.7% lower, with leading chipmaker TSMC, or Taiwan Semiconductor Manufacturing Co., shedding 1.7%.

Hong Kong’s Hang Seng gained 0.5% to 23,411.49. The Shanghai Composite index was up 1.1% to 3,638.03, despite China reporting over the weekend that its factory activity returned to contraction territory in October indicating that the economic momentum may have slowed.

China’s central bank and its securities regulatory body met with financial institutions Monday to discuss ways to support the markets, according to Chinese media reports. The Shanghai Composite index has fallen 14.6% in the past year.

In Australia, the S&P/ASX 200 lost 0.6% to 8,856.50.

India’s Sensex rose 1.3%.

On Friday, Wall Street’s benchmark S&P 500 fell 1.8% and the technology-heavy Nasdaq composite declined 2.9%. The Dow Jones Industrial Average slid 1.1%.

Investors are watching for the outcome of Tuesday’s U.S. midterm elections. Voters across the political spectrum have shown increasing concerns about AI and data centers, along with inflation and other key issues.

Oil prices dropped more than 2% early Monday, with Brent crude, the international standard, down 2.8% to $110.24 per barrel. Benchmark U.S. crude gave up 3.1%, to $100.85 a barrel.

Iran’s top diplomat said in an interview shared on his Telegram channel over the weekend that Iranian negotiators were in Qatar for talks on a proposal that could reopen the Strait of Hormuz within two days if the U.S. meets several conditions. However, he said no direct talks were being held with the U.S.

The final outcome of the diplomatic efforts to avoid a return to all-out war depends on answers provided by the United States to the “Iranian questions,” he said.

In other dealings early Monday, the U.S. dollar rose to 157.83 Japanese yen from 157.49 yen. The euro was trading at $1.1186, up from $1.1160.