Australia and Japan markets climb, looking past Iran war escalation fears

Markets in Australia and Japan mostly rose Friday, mirroring gains on Wall Street that saw both the S&P 500 and Nasdaq Composite reach new highs.

This comes as investors took in strong earnings from Apple and Caterpillar, looking past weaker-than-expected economic data and threats of escalation in Iran by U.S. President Donald Trump.

Brent crude prices briefly surged to $126 a barrel after Axios reported that the U.S. military would brief Trump on potential action against Iran.

However, Brent futures for June delivery later settled at $114.01 a barrel, while U.S West Texas Intermediate was 0.61% up at $105.71, as of 7:46 p.m. ET. Brent futures for July delivery closed at $110.4.

On Thursday, the U.S. Commerce Department reported that gross domestic product rose at a 2% annualized pace in the first quarter. While that was an increase from 0.5% in the fourth quarter of 2025, it was below the 2.2% consensus estimate by Wall Street economists.

Most major Asian markets are closed due to the May Day holiday.

Japan’s Nikkei 225 was marginally up to start the day, but the Topix was 0.62% down.

Australia’s S&P/ASX 200 was up 0.98%, on pace to snap an eight-day losing streak.

Overnight in the U.S., the S&P 500 rose 1.02% to close at a record of 7,209.01, its first close above the 7,200 threshold. The tech-heavy Nasdaq jumped 0.89%, hitting new intraday and closing records as well.

The blue-chip Dow Jones Industrial Average added 1.62%.

U.S. futures for all three major indexes were marginally up after the session, with S&P 500 futures advancing 0.16%, while Nasdaq 100 futures were little changed. Futures tied to the Dow Jones Industrial Average added 79 points, or about 0.2%.

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