
On Monday, U.S. equities posted strong advances. The Dow Jones Industrial Average surged to close at a new all-time high, while the S&P 500 gained 1.6% and the Nasdaq Composite climbed more than 3%. The rally was fueled by the peace agreement between US and Iran, with an official signing event expected later this week.
The agreement is expected to reopen the Strait of Hormuz, significantly reducing concerns about disruptions to global oil supplies. As a result, oil prices fell nearly 5% on Monday as investors removed much of the geopolitical risk premium that had built up during the conflict.
In early trading today,U.S. stock futures were little changed after yesterday’s rally.
Asian markets were mixed but generally positive. Japan’s Nikkei 225 reached a record intraday high, while South Korea’s Kospi gained nearly 2%.
Overall, investors welcomed the de-escalation in the Middle East, viewing it as supportive for economic growth and financial markets. Attention now shifts to upcoming U.S. economic data, including housing starts and trade price indicators, as well as the Federal Reserve meeting, which is expected to provide further guidance on the outlook for interest rates.
The Reserve Bank of Australia (RBA) left its benchmark interest rate unchanged at 4.35% on Tuesday but maintained a hawkish stance, signaling that it remains prepared to raise rates further if necessary to bring inflation under control.
The Bank of Japan (BOJ) raised its policy interest rate to 1.0% on Tuesday, the highest level in more than 30 years and in line with market expectations. The move marks the central bank’s first rate hike since December, when rates were increased to 0.75%, and the first time since 1995 that Japanese interest rates have reached 1%.
Gold prices remained slightly higher on Tuesday after rebounding strongly over the past few days, but investors await more details on the U.S.-Iran peace agreement and upcoming central bank decisions.
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