Juliet Oladele, Reporting
GLOBAL equities mostly rose on Tuesday while oil prices remained flat, following a historic peace deal between the United States and Iran that is set to reopen the strategic Strait of Hormuz.
Investors are now looking ahead to Friday’s formal signing ceremony in Switzerland, which will bring an end to more than three months of warfare that has sent shockwaves through energy markets and fuelled soaring global inflation.
The agreement, which President Donald Trump confirmed would see the strait “completely open” by Friday, has triggered a wave of optimism across financial markets. Iranian media reported that three oil tankers and two cargo ships had already passed through the waterway, which had been subject to a US naval blockade.
Tehran had blockaded the strait after the United States and Israel launched their war against Iran on February 28, with Washington subsequently blocking shipping to and from Iranian ports.
A senior US administration official revealed that Trump, Vice President JD Vance, and Iran’s parliamentary speaker Mohammad Bagher Ghalibaf had already signed the text electronically.
Investor Confidence Builds
Fiona Cincotta at City Index noted: “Investors are increasingly pricing in a lasting improvement in the geopolitical backdrop. However, with several details yet to be finalised, any setbacks could trigger a sharp market reaction. For now, confidence is growing that the Strait of Hormuz will reopen and energy supplies will normalise.”
She added: “The key question is not whether a deal is reached, but how quickly oil exports and production can recover.”
Oil industry watchers have cautioned that market conditions will likely remain tight for weeks or months. Fresh data from the US Department of Energy showed strategic oil stockpiles sank last week to their lowest level since 1983.
Shipping groups warned on Monday that it was too soon to safely resume sailing through the strait.
Markets React
The deal sparked a huge relief rally across global equities on Monday, with the Dow Jones hitting a record high, while crude prices plunged almost five per cent.
The optimism remained largely intact on Tuesday, with both main crude contracts barely moving and stocks mostly higher. West Texas Intermediate held flat at $80.77 a barrel, while Brent North Sea Crude remained unchanged at $83.19.
Seoul led gains once more, surging more than one per cent following Monday’s five per cent jump, helped by fresh advances in the tech sector. Elon Musk’s SpaceX enjoyed another blockbuster day, climbing almost 20 per cent for the second consecutive session after listing on Monday.
Shanghai, Singapore, Taipei, Wellington, and Manila also rose, though Tokyo, Hong Kong, and Sydney posted losses.
There was little reaction to news that Chinese retail sales shrank last month for the first time since 2022.
Investors are now keeping a close eye on the Bank of Japan’s policy meeting, where it is expected to hike interest rates to a 31-year high later in the day.
Key Figures Around 0230 GMT:
· Tokyo – Nikkei 225: DOWN 0.1% at 69,234.42
· Hong Kong – Hang Seng Index: DOWN 1.4% at 24,507.31
· Shanghai – Composite: UP 0.1% at 4,099.70
· Euro/dollar: DOWN at $1.1586
· Pound/dollar: DOWN at $1.3402
