Daily Summary: Peace Optimism Drives Strong Rally Across Global Markets

📈 Stock Markets

• Today's session was marked by a marked improvement in global investor sentiment, driven by discounting the scenario of de-escalation of the conflict in the Middle East and a potential agreement between the US and Iran.

• Due to a US holiday, the cash market on Wall Street remained closed, however, futures contracts were actively traded and very clearly indicated the direction of market sentiment.

• Futures contracts on the S&P 500 rose by about 1%, while the Nasdaq 100 gained over 1.3%, showing a return of risk appetite and a clear departure from the defensive positioning observed just a few days ago.

• Significant gains were also observed on European trading floors today, where Old Continent markets reacted very strongly to the improvement in geopolitical sentiment:

  • CAC 40 gained over 1.7%,

  • DAX rose by over 2%,

  • IBEX 35 gained over 2.2%,

  • Euro Stoxx 50 ended the day nearly 1.9%.

• Today's session showed one main thing — financial markets strongly believe in the possibility of reducing geopolitical tensions in the Middle East, although the question remains open whether investors did not start pricing in the full success of the negotiations too quickly, which still remain extremely politically sensitive.

🌍 Geopolitics

• The biggest catalyst for today's movements was further news regarding peace negotiations, including a statement by US Secretary of State Marco Rubio, who stated that talks with Tehran are about 90–95% complete, and the framework of a potential agreement is becoming increasingly coherent.

• Donald Trump also spoke optimistically, emphasizing that the talks are taking place in a "very good atmosphere".

• According to sources close to the White House, the parties are relatively close to signing a comprehensive memorandum on further cooperation and stabilization of the region, with some of the most problematic issues to be postponed to a later stage of negotiations.

• Information is also increasingly appearing about the possible involvement of China as a guarantor of the future agreement, where Beijing would act as a stabilizer and a party overseeing compliance with the agreed terms.

• Investors are beginning to more boldly discount the scenario of a gradual normalization of the geopolitical situation and the partial restoration of trade liquidity through the Strait of Hormuz, which remains one of the key points of global oil transport.

• According to reports by Nikkei, citing a Middle East diplomatic source, the US and Iran are discussing a plan to open the Strait of Hormuz about 30 days after the two countries reach a deal to end hostilities.

• However, the situation is complicated by reports from Axios – a senior US official hinted that the Trump administration will support the escalation of Israel's actions against Hezbollah, which could pose a significant risk factor for the ongoing peace process. 

🛢️ Commodities and Precious Metals

• The commodity market reacted very strongly to the incoming information – Brent crude oil came under heavy supply pressure and at times lost even about 7%, dropping to around 93–94 USD per barrel, due to pricing in the scenario of a partial normalization of the situation around the Strait of Hormuz and the potential restoration of the stability of energy supply.

• Positive sentiment was also visible in the precious metals market, where Gold gained over 1%, while Silver rose nearly 3%, showing that investors are clearly increasing exposure to alternative assets amid a weakening dollar and improving risk-on sentiment.

🪙 Cryptocurrencies

• Good sentiment also persisted in the cryptocurrency market, where Bitcoin rose by over 1.3% and approached the level of 78k USD, while Ethereum gained about 1.5%, trading in the region of 2140 USD.