Stock markets in the United States and Asia have experienced a significant uptick following an unexpected announcement from U.S. President Donald Trump regarding tensions with Iran. Trump revealed that he has called off planned military strikes against Iran and indicated that a peace agreement with Tehran is on the brink of being finalized. This news has sent Wall Street into a rally on Thursday, with the S&P 500 index surging nearly 1.8 percent, marking the largest single-day gain since April and breaking a three-day streak of losses.
In addition to the S&P 500’s performance, the tech-heavy Nasdaq Composite soared by 2.5 percent, while the traditional blue-chip Dow Jones Industrial Average saw an increase of approximately 1.9 percent. The positive momentum carried over into Asia on Friday, with notable gains reported across various markets.
South Korea’s Kospi, which has established itself as the top-performing major index this year, climbed more than 8 percent in morning trading. Japan’s Nikkei 225 also saw substantial growth, rising as much as 4 percent. In Taiwan, the TAIEX index recorded an increase of about 2.4 percent, while Australia’s ASX 200 rose by approximately 1.8 percent. Hong Kong’s Hang Seng Index added more than 1 percent to its value.
The drop in oil prices further complemented the market rally, as Brent crude, the international benchmark, fell about 1 percent to under $89.50 a barrel. This decline is attributed to optimistic projections about a return to stability in the Strait of Hormuz, a crucial shipping route that handles around one-fifth of the world’s energy supplies.
Trump’s remarks from the Oval Office stirred excitement among investors, especially the suggestion that a formal deal to end hostilities with Iran could be inked as early as this weekend. “We just made a great settlement of the war with Iran… subject to finalization of documents,” he stated, generating hope for a resolution in the region.
However, it’s essential to note that Iran has yet to publicly confirm Trump’s statements. Nevertheless, a spokesman for the Iranian Ministry of Foreign Affairs mentioned that a memorandum of understanding with the U.S. is currently “under consideration.”
Analysts suggest that for the market rally to maintain its momentum, investors will need to see not only the execution of the deal but also a complete reopening of the Strait of Hormuz. Khoon Goh, head of Asia research for ANZ Bank, highlighted the need for such developments for sustained market growth.
Market analyst Fabien Yip from IG Group in Sydney expressed that the rally reflects a significant reduction in geopolitical risks and noted anticipation for the impending market debut of SpaceX, which is expected to be the largest in history. Yip observed that the Asian market’s follow-through indicates genuine dip-buying interest, characterizing the recent activity not as a structural break in the bull market but as a healthy reset that could prolong the rally’s sustainability.
