Asian stock markets surge across the board! U.S. and Iran both express peace intentions, and the global market enters "rebound mode"

Ask AI · How do peace signals between Iran and the U.S. trigger a global market risk appetite rebound?

Cailian Press, April 1 (Editor: Xiaoxiang) As both the U.S. and Iran have released signals indicating an intention to end the conflict in the Middle East, on Wednesday, ( April 1 ), global market risk appetite sentiment rebounded further, and Asia-Pacific equities all followed the overnight surge in U.S. stocks.

Market data shows that the Nikkei 225 index expanded its gains to about 4% shortly after the market opened today. The Korean market’s performance was even more striking—shortly after the opening, KOSPI 200 futures’ rise exceeded 5%, prompting the Korea Exchange to activate a KOSPI index circuit breaker mechanism, with algorithmic trading paused for 5 minutes. Currently, the Korea Composite Stock Price Index’s gain has further expanded to 6%.

A-shares and Hong Kong stocks, which opened later, are also generally moving higher at present. As of the time of publication, the Shanghai Composite Index is up about 1.3% latest, and the Hang Seng Index is up nearly 2%.

“I call this the ‘Strait of Hormuz Hope’ rally,” said David Kotok, co-founder of Cumberland Advisors, “Market participants believe this is a turning point.”

The enthusiastic buying in Asian markets is benefiting from the signals of a de-escalation situation released simultaneously overnight by both the U.S. and Iran.

U.S. President Trump said on the evening of March 31 from the White House that the U.S. would end hostilities with Iran within “two to three weeks,” and may reach an agreement with Iran before then. This relatively clear timeline has greatly eased investors’ concerns that the Middle East conflict will continue to disrupt global markets for the long term.

U.S. Secretary of State Rubio also said most recently that the U.S. can see the “end line” of the Iran war. He said ending the Iran war is not today, and not tomorrow, but it will eventually come. Rubio said that no country is taking any action to help Iran or hinder the U.S.’s mission. He also said that direct talks with Iran could happen at some point in the future.

White House spokesperson Karoline Leavitt ( Karoline Leavitt ) has now posted a “teaser” on the X platform, stating that Trump will, at 9 p.m. local time on Wednesday ( and 9 a.m. Beijing time on Thursday ), provide the latest updates regarding Iran.

On the other side, Iranian President Pezeshkian also said Tuesday that Iran is willing to end the war, but only if its demands are met, especially guarantees that it will not face aggression again.

According to Iran’s Tasnim News Agency, Pezeshkian said on the day, during a telephone call with Charles Michel, President of the European Council, that the solution to normalize the situation is to stop the United States and Israel’s aggressive attacks. He reiterated that at no stage has Iran been seeking tension and war, and “has the necessary willingness to end this war.”

Eager buying in global markets

Rodrigo Catril, a currency strategist at the National Australia Bank, said, “Although there are still significant differences between the U.S. and Iran in their definitions of a ceasefire or peace, the market welcomes the fact that both sides are holding discussions.”

“This is at least a positive sign in terms of willingness to send signals or end the conflict,” he added. “As for whether a compromise can be reached, that remains to be seen. Meanwhile, the attacks from both sides are still continuing.”

It is also worth noting that the three major U.S. stock indexes all posted their best single-day performance since 2026 on the last trading day of March on Tuesday. The Nasdaq Composite led the gains that day, up 3.8%; the S&P 500 rose 2.9%, and the Dow Jones rose 2.5%.

For weeks, the war between the U.S. and Iran has been weighing on markets, dragging U.S. stocks to their worst quarterly performance in nearly four years. But on Tuesday, as investors saw hope that the conflict might turn, they stepped in decisively.

One indicator that measures strong investor demand for buying is the Tick Index, which measures the ratio of the number of advancing stocks to declining stocks on the New York Stock Exchange in seconds. On Tuesday, the index surged to 2329, setting a record high in history.

After Tuesday’s afternoon-midday, implied volatility for S&P 500 index options jumped across the board, with call options betting on an increase seeing the largest gains. “Traders are either directly betting on a sharp rebound after the war, or using call options to hedge the risk of missing out they may face after selling their stocks,” said Steve Sosnick, chief strategist at Interactive Brokers.

In related markets, while U.S. and Asia-Pacific equities rebounded across the board, international oil prices faced pressure as Middle East tensions eased. Brent crude oil futures fell by about 1.2% on Tuesday, with the settlement price at $101.38. In the Asian trading session on Wednesday, prices changed little and were trading near the $103 level.

Regarding changes in rate expectations, according to the ( CME ) FedWatch tool of the Chicago Mercantile Exchange, the latest pricing of federal funds rate futures shows that at the Fed’s two-day meeting ending July 29, the implied probability of a 25-basis-point rate cut is 32%, compared with only 7.5% the day before.

However, some market participants are still taking a cautious stance before the situation in the Middle East becomes completely clear.

Jack Janasiewicz, portfolio manager at Natixis Investment Managers, said the market is “definitely looking for reasons to bounce.” “Our question is—how real is all of this?”

Brian Nick, portfolio strategy director at Newedge Wealth, also pointed out that he is not yet prepared to conclude that the stock market has already bottomed out until there are clear signs of a formal decision being reached between the two sides.

(Cailian Press Xiaoxiang)