Stocks rally on optimism over Iran war ceasefire, oil extends gains
Stocks rose Friday with investors still optimistic about the shaky ceasefire in the US-Iran war ahead of planned weekend talks, though oil prices extended gains over worries Israel’s continued attacks on Lebanon could shatter the peace process. Tuesday’s announcement of a two-week truce that would see the Strait of Hormuz reopened, having been closed since the start of the war, sparked a wave of euphoria across markets.
But hopes for an end to the crisis have been hit by squabbles over the agreement and the future of the key waterway, through which about a fifth of the world’s oil and gas passes. US and Iranian delegations are due in Pakistan for peace talks, but they come as Tehran says Israel has already broken terms of the ceasefire by continuing to hit Lebanese targets, where Israel says Iran-backed Hezbollah is located.
The United States and Israel deny an end to attacks on Lebanon was in the deal. Meanwhile, Trump warned on Thursday against Iran’s plan to charge a toll for ships passing through Hormuz, saying on social media: “They better not be and, if they are, they better stop now!” In a second message just a few minutes later, he added that “very quickly, you’ll see Oil start flowing, with or without the help of Iran.” He also said Tehran was “doing a very poor job, dishonorable some would say, of allowing Oil to go through the Strait of Hormuz”.
Just 10 vessels have passed through the waterway since the Middle East war ceasefire took effect, according to maritime tracking data. Only one of those tankers is not Iranian. Equity markets, which have been hammered since the war broke out on February 28, extended the week’s gains. Tokyo, Hong Kong, Seoul, Shanghai, Taipei, Singapore, Mumbai, Bangkok, Jakarta and Manila were all up, though Sydney slipped with Wellington.
