Stock markets have swiftly bounced back from worries surrounding a potential conflict between the US and Iran and have reached nearly all-time highs.
The strong performance of European markets has led to a global upturn in stocks. Today marks the best day in weeks for Asian markets, with increases seen worldwide. Hong Kong’s Hang Seng index rose over 1.2%, along with gains in Shanghai’s stock index. Australian stocks also saw a collective rise of 0.8%. Traders are moving away from safe-haven assets and returning to the stock markets. However, traditional safe-haven currencies like the Japanese Yen and Swiss Franc have experienced slight declines. Gold prices have also dropped to $1,544.80 per ounce, erasing yesterday’s gains. Economists worldwide attribute this recovery to the de-escalation of tensions between the US and Iran.
US President Trump expressed positivity about the situation post-attack in the Middle East, stating, “Iran seems to be de-escalating, which is beneficial for all parties involved and the global community.” Iranian Foreign Minister Mohammad Javad Zarif indicated that the missile strikes on US forces in Iraq marked the completion of Iran’s retaliation for the killing of General Qassem Soleimani.
Emerging markets have responded positively to the news of de-escalation between the US and Iran. Currencies in China, Turkey, and South Africa have all recovered losses incurred yesterday. Overall market sentiment is optimistic, with risk aversion measures showing signs of easing.
