Asian shares retreated from record highs as oil prices extended their gains on renewed shipping woes in the Gulf, underscoring fragile risk sentiment as a peace deal eludes the US and Iran, reports Reuters.

European stocks are bracing for a much weaker open, with pan-region futures down 1.1 per cent. Wall Street futures also skidded 0.5pc in Asia.

Overnight, the S&P 500 climbed 1pc and the Nasdaq jumped 1.6pc to notch fresh record-closing highs, helped by a strong start to the earnings season that has eased concerns about the health of the US consumer despite rising energy prices from the Iran war.

MSCI’s broadest index of Asia-Pacific shares outside Japan had earlier tracked Wall Street and rallied to a record of 831.56 points, but selling soon kicked in. It was last down 0.5pc.

Japan’s Nikkei vaulted to a new high for a second day before falling 0.9pc. Markets in Taiwan and South Korea also hit new highs and then turned lower.

China’s blue chips fell 0.8pc and Hong Kong’s Hang Seng index skidded 1.1pc.

Higher oil prices were partly to blame, with Brent crude futures up another 1.4pc to $103.3 a barrel, having jumped 3.5pc overnight to cross back above $100.