The United States and Iran have reached a two-week ceasefire agreement, leading to a strong rebound in the Asia-Pacific financial markets on Wednesday, April 8. This diplomatic breakthrough, with the core condition of reopening the global energy lifeline of the “Strait of Hormuz,” effectively alleviates concerns in the market about the war’s comprehensive impact on the global economy.
In early trading on Wednesday, the South Korean stock market showed the most impressive performance. The Korean KOSPI index surged by 5.99%, and the Kosdaq index, dominated by small and medium-sized stocks, also rose by nearly 5%.
The Japanese stock market also showed strong performance, with the Nikkei 225 index rising by 1.8% and the Tokyo Stock Price Index (Topix) increasing by 1.7%.
Australia’s S&P/ASX 200 index jumped by 2.8%, while Hong Kong’s Hang Seng Index futures also indicated a significant uptrend after the opening.
Earlier, U.S. President Trump confirmed in a post on the social platform Truth Social that, under the mediation of Pakistani Prime Minister Shehbaz Sharif and Army Chief of Staff Asim Munir, he had agreed to postpone the planned military action for two weeks.
Trump made it clear that the premise of this decision was that “the Islamic Republic of Iran agrees to fully, immediately, and safely open the Strait of Hormuz.”
“I have agreed to suspend bombing and military strikes against Iran for two weeks. This will be a bilateral ceasefire!” Trump wrote in the post. “The reason for this decision is that we have achieved and surpassed all military objectives, made significant progress in reaching a long-term peace agreement with Iran, and in achieving Middle East peace.”
Subsequently, Iranian Foreign Minister Abbas Araghchi, speaking on behalf of the country’s Supreme National Security Council, issued a statement indicating that Tehran’s armed forces would “cease defensive operations.”
Regarding the passage in the Strait of Hormuz, Araghchi stated that Iran would coordinate with its armed forces over the next two weeks and ensure the safe passage of ships “taking into account technical limitations.”
According to the consensus reached, the U.S. and Iran will begin further negotiations in the Pakistani capital of Islamabad in the coming days.
Market analysts are generally optimistic about this development. Josh Rubin, portfolio manager at Thornburg Investments, believes that energy prices have been a major driver of global inflation since the start of the war, and a decrease in energy prices would greatly benefit economic prospects.
Rubin said, “If people now believe, or can foresee, that energy prices can fall, this is beneficial for easing inflation and even more favorable for the prospect of central banks cutting interest rates.”
The ceasefire agreement was reached less than two hours before the final deadline set by Trump, triggering a sharp drop in international oil prices.
U.S. West Texas Intermediate (WTI) futures prices fell by over 16%, dropping below $95 per barrel. International benchmark Brent crude futures for June also fell by more than 15%, reaching $92.21 per barrel. This provides valuable breathing space in the recent turbulence in the energy markets.
The market is now closely watching whether this preliminary agreement can be transformed into long-term stability and peace.