Global Stocks Rise as Oil Climbs on Fragile US–Iran Ceasefire Hopes and Middle East Tensions

Global financial markets edged higher on Friday as investors reacted cautiously to a fragile ceasefire linked to tensions involving the US–Iran conflict ceasefire, even as rising oil prices signalled lingering fears over renewed instability in the Middle East.

Equity markets across Asia led the gains, supported by optimism that weekend peace talks could ease pressure on global trade routes, particularly the critical Strait of Hormuz, through which a significant share of the world’s oil flows.

The initial market rally was triggered earlier in the week after reports of a temporary truce and the possible reopening of key shipping routes. However, sentiment remains fragile as disagreements continue over enforcement of the agreement and ongoing military activity in parts of the region.

Oil prices extended their upward movement, with Brent crude and West Texas Intermediate hovering near the $100-per-barrel mark. Traders remain concerned that renewed tensions involving Israel and Lebanon could disrupt supply chains and undermine any diplomatic progress.

In Asia, major indices including Tokyo’s Nikkei 225, Hong Kong, Seoul, Shanghai, and Singapore closed higher, reflecting renewed appetite for risk assets despite geopolitical uncertainty.

The United States and Iranian delegations are expected to meet in Pakistan for further negotiations, even as accusations persist that ceasefire terms have already been breached. The United States and Israel have rejected claims that attacks in Lebanon violate any agreed pause in hostilities.

Former U.S. President Donald Trump warned against any attempt to impose tolls on shipping through Hormuz, insisting that oil flow must remain uninterrupted, while also signalling confidence that energy supplies would stabilise regardless of Iran’s position.

Market analysts say investor sentiment is being driven by the possibility of partial diplomatic breakthroughs, including reported efforts to reduce military escalation between Israel and Lebanon, which could improve the chances of a broader regional deal.

However, institutions such as the International Monetary Fund International Monetary Fund have warned that the conflict’s economic impact could weigh on global growth, citing rising energy costs and supply disruptions as key risks.

In company news, Japan’s Fast Retailing saw its shares surge after strong earnings guidance, supported by global demand for its Uniqlo brand, adding to the overall positive tone in Asian markets.

Despite Friday’s gains, analysts caution that the outlook remains uncertain, with inflation data from the United States and ongoing geopolitical negotiations likely to determine whether markets can sustain their recent recovery.