SINGAPORE - Stocks fell in Asia on Friday, the dollar headed for its largest weekly gain in four months and oil prices were rising as a US military build up in the Middle East and a rout in private equity stocks sent ripples of nerves across markets.

Japan's Nikkei dropped 1 percent. 

Overnight on Wall Street listed private equity stocks took a beating after one manager, Blue Owl, sold assets and permanently stopped quarterly redemptions from one of its funds, stoking wider concerns about valuations and liquidity in the sector.

Blue Owl stock finished about 6 percent lower and shares in larger rivals Apollo Global Management and Blackstone fell more than 5 percent.

Benchmark Brent crude futures touched 6-1/2 month peaks above $72 a barrel as US President Donald Trump set a deadline of 10 to 15 days for Iran to make a deal over its nuclear program or "really bad things" will happen.

Taken together, the news had investors shying away from risk, said Kenji Abe, chief strategist at Daiwa Securities in Tokyo, and positioning ahead of an earnings report from the world's most valuable company, Nvidia, next week.

The chipmaker is close to finalising a $30 billion investment into OpenAI that will replace the long-term $100 billion commitment agreed upon by the companies last year, the Financial Times reported on Thursday, citing sources.

Walmart shares fell about 1.4 percent after new CEO John Furner offered a cautious outlook on the US consumer.

The US trade deficit widened sharply in December, data showed and the goods shortfall in 2025 was the highest on record suggesting Trump's tariffs have had little impact.

 Dollar notches weekly gain

In foreign exchange trade, the dollar was headed for its largest weekly rise in four months thanks to a patchwork of slightly stronger US data and minutes from the Federal Reserve that suggested no hurry to lower interest rates.

For the week the dollar is up about 0.9 percent on the euro, pushing the common currency to $1.1762. Morning moves were modest on Friday.

Japan's yen was lower after data showed Japanese core inflation at 2 percent in January, its slowest pace in two years, possibly complicating the central bank's hiking path.

For the week, the dollar is up 1.6 percent to 155.2 yen.

The Australian dollar was holding its own at $0.7047 as a widening yield premium provided a buffer, while the kiwi was hamstrung by the fading chance of early rate hikes and headed for its largest weekly drop of 2026 so far.

US Treasuries were steady, with 10-year yields at 4.06 percent, while division evident in the Fed minutes over whether or how fast to cut rates has lifted two-year yields by five basis points over the week to 3.46 percent.

"There does not seem to be much point in adding risk ahead of this weekend’s uncertainty surrounding the Middle East," saud Spectra Markets' President Brent Donnelly.

"Today feels like a good day to stay out of trouble."