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Stocks jump on renewed hopes for ceasefire

Equity markets in the Asia-Pacific region and on Wall Street rose on hopes of a possible ceasefire in the Iran conflict. Reports suggest that US President Trump is considering winding down the war in Iran without fully reopening the Strait of Hormuz. The potential de-escalation comes after the effective closure of the key oil shipping route pushed Brent crude towards USD 115 a barrel from around USD 70 before the conflict, lifting US gasoline prices above USD 4 a gallon and stoking global inflation fears.

  • Date
  • Auteur Alessandro Fezzi, Content & Publications
  • Temps de lecture 5 minutes

Middle East financial markets
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Asia-Pacific equities rallied on Wednesday after comments from US President Donald Trump and reports of possible Iranian willingness to end the war fuelled risk appetite. South Korea’s Kospi led regional gains, climbing 8.9% as March exports from South Korea rose 48.3% year-on-year after a smaller increase a year earlier, while the tech-focused Kosdaq added 5.4%. Japan’s Nikkei 225 advanced 4.9% and the broader Topix rose 3.8% as the Bank of Japan’s first-quarter Tankan survey showed sentiment among large manufacturers improving from 15 to 17, the strongest reading since the end of 2021, while non-manufacturing confidence remained robust at 36. Hong Kong’s Hang Seng index gained 2.2%, mainland China’s CSI 300 climbed 1.5% despite a softer private manufacturing PMI reading of 50.8 in February after 52.1 in January, and Australia’s S&P/ASX 200 and India’s Nifty 50 also moved higher.

US equities surge on hopes for end of Iran war 

US stocks advanced strongly on Tuesday as hopes for a near-term end to the Iran war and a lower oil price eased recent inflation concerns. The Dow Jones Industrial Average rose 2.5% to 46,341.51 points, its sharpest daily increase since a rally in May last year and leaving the index further above the psychologically important 45,000-point level, although the Dow still closed the month down 5.4%, its steepest monthly loss since September 2022. The broad-based S&P 500 gained 2.9% to 6528.52 points, while the technology-heavy Nasdaq 100 climbed 3.4% to 23,740.19 points, helped by strong moves in selected pharmaceutical, biotech and chip stocks. 

The S&P/Case-Shiller House Price Index showed a 1.2% rise in home prices across 20 major US metropolitan areas, down from 1.4% the previous month and below forecasts for 1.4%. The softer-than-expected gain points to a modest cooling in the housing market.

Eurozone inflation jumps on oil surge

Euro-area consumer price inflation accelerated to 2.5% in March from 1.9% in February, surpassing the ECB’s 2% target as energy costs rose 4.9%. The increase, driven by oil and gas prices that have nearly doubled amid the Iran war, was slightly smaller than economists had anticipated, while core inflation, excluding food and energy, eased to 2.3% from 2.4% and services inflation fell to 3.2% from 3.4%. Markets are currently divided over whether the ECB should look through what could be a temporary supply shock or raise interest rates to prevent higher energy costs from feeding into wages and broader price-setting. ECB President Lagarde and Bundesbank head Nagel have signalled a willingness to act if second-round effects emerge, and markets are pricing in three rate hikes this year and the first move expected in either April or June. 

German institutes trim growth forecasts

Germany’s leading economic institutes have reduced their forecasts for gross domestic product growth to 0.6% in 2026 and 0.9% in 2027, down from previous projections of 1.3% and 1.4%, citing the impact of the Iran war. The institutes now expect inflation in Germany at 2.8% in both 2026 and 2027, compared with earlier estimates of 2.0% and 2.3%, as higher energy prices feed through to consumer prices, with headline inflation already at 2.8% in March. 

A survey by Munich-based Ifo institute indicated that 90% of German manufacturing companies expect the Iran conflict to weigh on their business, underlining the fragile state of Europe’s largest economy.

European stocks extend cautious rebound

Major European equity indices edged higher on Tuesday as hopes for a near-term end to the Iran war helped markets recover further from recent losses, even as concerns persisted about the economic fallout of elevated energy prices. The euro-area blue-chip EuroStoxx 50 rose 0.5% to 5569.73 points, but still recorded a 9.3% decline for the month, its steepest monthly drop since March 2020 when the pandemic triggered a sharp sell-off. Switzerland’s SMI gained 0.9% to 12,776.79 points.

Corporate and economic calendar

Corporate news in focus: There is no major corporate news scheduled today.

Economic data in focus: euro-area unemployment rate (11:00), US ADP National Employment Report (14:15), US retail sales (14:30), Canadian Purchasing Managers’ Index (15:30) and US ISM Purchasing Managers’ Index (16:00).

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Publisher: LGT Bank (Switzerland) Ltd., Glärnischstrasse 36, CH-8027 Zurich
Editor: Alessandro Fezzi
Source: LGT Bank (Switzerland) Ltd.

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