Japan, South Korea stocks hit record high as investors shrug off stalled U.S.-Iran negotiations

Asia-Pacific markets were mostly higher Monday as investors looked past renewed diplomatic setbacks between the U.S. and Iran, even as escalating tensions in the Middle East kept oil prices elevated.

Japan’s Nikkei 225 added 0.53% to hit a record high, while South Korea’s Kospi jumped 1% to also notch a record level.

In Australia, the S&P/ASX 200 slid 0.54%.

Sentiment held up despite U.S. President Donald Trump on Saturday scrapping plans to send U.S. envoy Steve Witkoff and Jared Kushner to Islamabad, Pakistan for negotiations with Iran.

“Too much time wasted on traveling, too much work! Besides which, there is tremendous infighting and confusion within their ‘leadership,'” Trump wrote in a post on Truth Social.

Oil prices jumped about 2% after plans for a second round of peace negotiations between the U.S. and Iran unraveled again.

International benchmark Brent oil futures rose more than 2% to $107.49 per barrel by 7:35 p.m. ET, while U.S. crude oil also jumped 1.79% to $96.19.

Tensions in the Strait of Hormuz remain high after Iran’s Revolutionary Guard reportedly boarded two cargo ships near the strategic sea lane.

Hong Kong Hang Seng index futures were at 26,041 compared with the index’s last close of 25,978.07.

U.S. futures edged lower, with Dow Jones Industrial Average futures declining 0.2%, or 130 points. S&P 500 futures lost 0.3%, while Nasdaq 100 futures slipped 0.3%.

Last Friday in the U.S., the S&P 500 and Nasdaq Composite closed at record levels. The broad market index finished up 0.8% at 7,165.08, while the tech-heavy Nasdaq added 1.63% to settle at 24,836.60. Both indexes also scored fresh all-time intraday highs. However, the Dow Jones Industrial Average fell 79.61 points, or 0.16%, to end at 49,230.71.

— CNBC’s Sean Conlon and Lisa Kailai Han contributed to this report.