Asian stock markets cheered the announcement of a peace deal framework between the United States and Iran, with major indices recording significant gains. Japan's Nikkei index rose over 4% to set a new intraday record high, according to Kyodo News.
Regional Market Performance
South Korea's Kospi jumped 4.3% at the opening, while Australia's ASX200 traded 125 points or 1.4% higher to 8,928. Seven of 11 sectors on the Australian index were higher, led by a rally in materials sector which gained 3.5%.
Oil Prices Decline
US crude oil futures for July delivery fell 4.77% to $80.83 per barrel. Brent futures for August delivery traded about 4% lower to $83.77 per barrel. S&P 500 futures climbed 0.8%, while Nasdaq futures jumped 1.4%. Nikkei futures rose 2% to 68,685, far above Friday's cash close of 66,020.
Peace Deal Announcement
US President Donald Trump announced the completion of the peace deal on Monday, declaring the reopening of the strategically important Strait of Hormuz and the immediate removal of the US naval blockade. In a post on Truth Social, Trump wrote, "The Deal with the Islamic Republic of Iran is now complete. Congratulations to all! I hereby fully authorise the toll-free opening of the Strait of Hormuz, and, simultaneously herewith, authorise the immediate removal of the United States Naval blockade. Ships of the World, start your engines. Let the oil flow!"
Iran's Deputy Foreign Minister for Legal and International Affairs Kazem Gharibabadi confirmed the peace deal and stated that Tehran will enter a proposed 60-day negotiation period for a final agreement only after verifying Washington's commitments towards ending hostilities, lifting the blockade, and releasing Iranian assets.
Official Signing Ceremony
According to Iran's state-affiliated Press TV, Gharibabadi said the official signing ceremony of the agreement will take place on Friday, after which the text of the Memorandum of Understanding will be made public. He noted that the memorandum was not just a product of diplomacy but also indebted to Iran's military achievements and the blood of martyrs.
This peace deal brings closure to a conflict that had significantly affected global economies by choking oil supplies through the Strait of Hormuz. After 108 days, the conflict is ending, bringing relief and a sense of normalcy to global markets.
