* MSCI's Asia-Pacific index outside Japan falls 0.69%, led

by South Korea's 3.64% slide

* Brent slips 0.18% to $79.31 a barrel as Iran deal

developments stay in focus

* CME FedWatch tool prices 54% chance of September Fed rate

hike

By Satoshi Sugiyama

TOKYO, Aug 6 (Reuters) - Asian shares took a breather on

Thursday after an AI-driven surge the previous day, while oil

prices traded in a tight range as markets assessed prospects for

an Iran peace deal.

MSCI's broadest index of Asia-Pacific shares outside Japan

fell 0.69%, led by declines in tech firms. South

Korean shares dropped 3.64% while Japan's Nikkei

lost 1.57%.

In Seoul, Samsung Electronics ( SSNLF ) fell 2.44% and

peer SK Hynix ( SKHY ) lost 6.95%. In Tokyo, Kioxia ( KXHCF )

plunged 9.61%, while Tokyo Electron ( TOELF ) slumped 4.61%.

The pullback followed a weaker session on Wall Street

overnight, where the Nasdaq snapped a days-long winning

streak as shares of Elon Musk-led SpaceX and Advanced

Micro Devices ( AMD ) stumbled after their quarterly earnings.

Although the AI and satellite company highlighted

faster-than-expected returns from its AI spending, investors

remained concerned about how long its profitable Starlink

business could continue to bankroll costly investments in data

centres.

And while AMD's results beat analysts' estimates, they fell

short of investors' lofty expectations.

A senior Iranian source and two regional officials told Reuters

that a proposed deal between Iran and Oman to help end five

months of war between Iran and the United States would give

Tehran control over ships entering the Gulf through the Strait

of Hormuz, one of the biggest concessions yet to Iran.

Oil prices were steady in the $70-a-barrel range. Brent crude

futures LCOc1 fell to $79.31 per barrel, down 0.18%. U.S. West

Texas Intermediate futures CLc1 edged 0.35% down to $74.96 a

barrel.

Madison Cartwright, senior geo-economics analyst at

Commonwealth Bank of Australia, said a deal to reopen the Strait

of Hormuz could be reached by early September, though he

remained sceptical that a deal was imminent.

"Iran still has more leverage and will extract additional

concessions from the U.S. under any new deal," Cartwright said

in a note.

Investors are now turning their attention to U.S. labour

market data ahead of Friday's closely watched nonfarm payrolls

report. ADP figures on Wednesday showed private employers added

44,000 workers last month, slowing from 95,000 in June and

coming in about 25,000 below expectations.

Economists polled by Reuters expect the government's report

to show the U.S. economy added 80,000 jobs in July, after a

57,000 gain in June, with the unemployment rate forecast to hold

steady at 4.2%.

Futures markets are pricing in about a 54% chance of a rate

hike at the Federal Reserve's September meeting, down from 58% a

day ago, according to the CME's ​FedWatch tool.

The yield on benchmark U.S. 10-year notes

fell 1.04 basis points to 4.607%.

Against the yen, the dollar was steady at 157.66

following a historic currency market intervention. Japan and the

U.S. launched a rare joint yen-buying intervention last week and

pledged further action if necessary to support the currency.

The dollar/yen pair is likely to struggle to find a clear

direction, with investors expected to stay largely on the

sidelines ahead of Friday's U.S. job report, said Sony Financial

Group senior analyst Juntaro Morimoto.

Spot gold rose 1.06% to $4,290.26 an ounce, while spot

silver gained 0.65% to $62.48 an ounce.