Oil slumps, bonds rally and stocks surge as U.S. and Iran agree to two-week ceasefire
Why it matters: The two-week ceasefire allows Iran to reopen the Strait of Hormuz, potentially restoring 20% of the world's oil and gas transit.
- U.S. President Donald Trump agreed to suspend bombing and attacks on Iran for two weeks, with a long-term peace agreement reportedly in progress, according to the main story.
- Oil prices dived, with U.S. crude futures falling around 16.5% to US$94 a barrel, and plunging below $100 according to CNBC and Axios, as Iran agreed to safe passage through the Strait of Hormuz (ZeroHedge).
- Stocks surged, with S&P 500 futures leaping over 2%, and futures pointing to broad gains for Asia’s stock markets.
- Bonds rallied, with 10-year U.S. Treasury futures jumping about 15 ticks.
- Cryptocurrencies also rose, with Bitcoin reclaiming $72K (Cointelegraph), while the risk-sensitive Australian dollar rose 1.3% to above US$0.7070 and the euro gained 0.76% to US$1.1683.
- Gold prices rose over 2% to US$4,812 per ounce, despite the broader market relief.
Global markets surged and oil prices plunged after the U.S. and Iran agreed to a two-week ceasefire, allowing for the potential resumption of oil and gas flow through the critical Strait of Hormuz. This relief rally saw stocks, bonds, and cryptocurrencies climb, while the dollar, previously a safe haven, broadly fell.
