Asia-Pacific markets rallied on Wednesday after US President Donald Trump said he had agreed to suspend planned attacks on Iran’s infrastructure for two weeks.
The move is “subject to the Islamic Republic of Iran agreeing to a FULL, IMMEDIATE and SECURE OPENING of the Strait of Hormuz,” he wrote on Truth Social.
Iranian Foreign Minister Abbas Araghchi said in a statement on X on behalf of the country’s Supreme National Security Council that Tehran’s armed forces would “cease their defensive operations.”
Trump noted that the two-week ceasefire was conditional on Iran agreeing to the full, immediate and safe opening of the Strait of Hormuz. Araghchi said safe passage through the Strait of Hormuz will be possible through coordination with the Iranian armed forces in the next two weeks.
US crude oil prices fell after the news. The West Texas Intermediate contract for May delivery fell 14.86% to $96.18 a barrel at 11:50 p.m. ET. The international reference price of Brent recorded a decline in June futures prices of 13.24% to USD 94.81 per barrel.
South Korea’s Kospi rose more than 6%, while small-cap Kosdaq rose 3.95%. Heavyweights on the index, Samsung Electronics and SK Hynix, jumped by 7.12% and 9.61%, respectively.
Japan’s Nikkei 225 extended gains to 5.05%, while the Topix rose 3.13%.
China’s CSI 300 rose 2.76%, while Hong Kong’s Hang Seng advanced 2.87% after trading resumed after the holiday. Australia’s S&P/ASX 200 rose 2.62%.
India’s Nifty 50 rose 3.32%.
“For a long time, energy prices were doomed to pretty inflationary swings around the world. And if there’s now some conviction or some visibility that energy prices can bottom out, that’s better for inflation, better for the prospect of central bank tapering and so on,” said Josh Rubin, portfolio manager at Thornburg Investments.
Futures related to the Dow Jones Industrial Average rose by 718 points, or 1.5%. S&P 500 futures added 1.6% and Nasdaq 100 futures rose 1.7%.
Overnight in the US, the S&P 500 gained 0.08% to close at 6,616.85, while the Nasdaq Composite advanced 0.10% to close at 22,017.85. The Dow Jones Industrial Average lost 85.42 points, or 0.18%, to close at 46,584.46.
