Oil prices fell sharply, while global stock markets surged on Monday after the United States and Iran announced an agreement to reopen the Strait of Hormuz, raising hopes of a lasting end to a conflict that has rattled energy markets and fuelled inflation worldwide.
The world markets welcomed the prospect of reduced geopolitical tensions despite lingering uncertainty. Investor sentiment particularly improved significantly after Brent crude oil prices dropped 4.8% to $83.14 a barrel, a steep decline from levels above $100 recorded only weeks ago.
Although prices remain higher than before the conflict erupted more than three months ago, the retreat eased concerns about rising fuel, transport and food costs.
The proposed agreement still required formal signing in Switzerland on Friday, includes the reopening of the strategically vital Strait of Hormuz, a key route for global oil shipments. Iran confirmed the framework but indicated implementation would begin only after the accord is formally signed.
On Wall Street, the benchmark S&P 500 climbed 1.9%, while the Dow Jones Industrial Average gained more than 700 points, or 1.4%. The tech-heavy Nasdaq Composite jumped 3%, led by strong gains in artificial intelligence and semiconductor stocks.
Shares of companies heavily exposed to fuel costs were among the biggest beneficiaries. United Airlines rose 4.7%, American Airlines gained 3.3%, and cruise operator Carnival advanced 3.6%. Technology stocks also rallied strongly.
In Asia, Japan’s benchmark Nikkei 225 surged 5% to a record high, while European markets also posted broad gains. Bond markets reflected growing optimism as US Treasury yields edged lower, with investors betting that falling energy prices could reduce inflationary pressures.Latest News, Breaking News & Top News Stories | The Express TribuneagenciesRead More