Asian Stocks to Rise on Firming US-Iran Sentiment: Markets Wrap

(Bloomberg) — Asian equities were poised to advance after the US and Iran reached a tentative deal to extend their ceasefire. Treasuries rallied and oil dropped.

Equity-index futures for Japan, South Korea and Hong Kong were all higher early Friday. Contracts for US stocks edged up after the S&P 500 Index rose 0.6% to a new high, while the Nasdaq 100 Index climbed 0.8% to also hit a record. Optimism toward AI remained high with Dell Technologies Inc. surging almost 40% in extended trading on its sales outlook.

American crude dropped 0.4% to about $88.60 a barrel on Friday following a deal to extend the ceasefire by 60 days and launch further talks on Tehran’s nuclear program, which raised hopes that the three-month conflict may be nearing a resolution. President Donald Trump has yet to agree to the terms.

During the US session, Treasury yields fell across the curve and the dollar weakened against all major developed-market currencies.

Optimism over a ceasefire extension outweighed concerns about clashes in the Persian Gulf, as investors bet a truce may ease disruptions to energy flows. The closure of the Strait of Hormuz since the war began has curbed oil shipments and stoked inflation fears, with markets now eagerly watching for any signs the vital corridor may reopen.

“Markets continue to get whipsawed by swings in Iran war sentiment,” said Elias Haddad at Brown Brothers Harriman & Co. “Regardless, risk-on sentiment should remain supported because both sides are still talking to work out a deal that would ultimately reopen the Strait of Hormuz.”

Both countries have previously hailed progress, with Trump repeatedly indicating the US was close to securing an agreement — only for the stalemate to drag on.

When asked if an interim deal had been clinched, Treasury Secretary Scott Bessent would only say “the teams have been going back and forth.” He insisted Trump’s three “red lines” — reopening Hormuz, Iran turning over highly enriched uranium and ending its nuclear program — remained necessary for a pact.

“Even if it is only a 60-day agreement to allow a resumption of traffic in the Strait, there should be a relief rally, as serious supply dislocations are approaching rapidly,” said veteran strategist Louis Navellier.

Optimism toward artificial-intelligence stocks has helped equities rally to new highs, placing the S&P 500 Index on track for a ninth straight week of gains — a streak matched only four times since 1985. Asian shares are also set for a second week of gains.

At the same time, higher energy costs have fueled price pressures, raising concerns the Federal Reserve would be forced to lift interest rates. US consumer spending edged up in April, with annual inflation accelerating to the highest since 2023. Meantime, the economy expanded in the first quarter at a 1.6% annualized pace, slower than previously estimated.

“The economy is still expanding, but hotter inflation limits the Fed’s flexibility and pushes rate cuts further out,” said Gina Bolvin at Bolvin Wealth Management Group. “This is a more difficult environment for investors because the growth story is cooling just as inflation is heating back up.”

Corporate Highlights:

Anthropic PBC raised $65 billion in a funding round that valued the artificial intelligence company at $965 billion including the new investment, eclipsing rival OpenAI’s value for the first time. Snowflake Inc. soared on a stronger-than-expected outlook and a $6 billion multiyear agreement to use Amazon.com Inc.’s cloud services and chips. BYD Co., the world’s largest electric vehicle maker, unveiled a series of technology advances, including what it calls China’s first automotive-grade 4-nanometer chip for self-driving cars. Pfizer Inc. and China’s Innovent Biologics Inc. signed a global agreement worth as much as $10.5 billion to develop cancer drugs. Some of the main moves in markets:

Stocks

S&P 500 futures were little changed as of 8:09 a.m. Tokyo time Hang Seng futures rose 0.6% S&P/ASX 200 futures rose 0.6% Currencies

The Bloomberg Dollar Spot Index was little changed The euro was unchanged at $1.1651 The Japanese yen was little changed at 159.25 per dollar The offshore yuan was little changed at 6.7726 per dollar The Australian dollar was little changed at $0.7164 Cryptocurrencies

Bitcoin was little changed at $73,462.65 Ether fell 0.3% to $2,005.32 Bonds

Australia’s 10-year yield declined four basis points to 4.85% Commodities

West Texas Intermediate crude fell 0.4% to $88.53 a barrel Spot gold was little changed This story was produced with the assistance of Bloomberg Automation.

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