Global markets rally, oil tumbles as Trump signals progress in Iran peace talks

By Mahima Katal Global markets largely moved higher on Monday, while oil prices dropped sharply after US President Donald Trump indicated that negotiations aimed at ending the conflict with Iran were making progress.

European markets recorded gains, with France’s CAC 40 rising 1.1% to 8,203.32, Germany’s DAX climbing 1.0% to 25,148.39, and Britain’s FTSE 100 adding 0.2% to close at 10,466.26. US markets remained closed in observance of Memorial Day.

Asian markets also posted strong performances. Japan’s Nikkei 225 jumped 2.9% to 65,158.19, Australia’s S&P/ASX 200 increased 0.4% to 8,692.00, and China’s Shanghai Composite advanced nearly 1% to 4,152.57. Markets in South Korea and Hong Kong were closed for the Buddha’s Birthday holiday.

Trump stated that discussions with Iran were moving forward in an “orderly and constructive manner.” According to regional officials cited by the Associated Press, Washington and Tehran are nearing an agreement that could bring an end to the conflict, reopen the Strait of Hormuz, and involve Iran surrendering its stockpile of highly enriched uranium.

The reopening of the Strait of Hormuz remains central to global energy markets. The conflict had disrupted tanker movement through the route, limiting crude exports from the Persian Gulf. Countries such as Japan, which depend heavily on imported oil, have been closely monitoring developments.

Market analyst Stephen Innes said investors are shifting from concerns over geopolitical risk toward expectations of a “peace dividend,” with hopes of reopening the Strait contributing to lower oil prices and a weaker US dollar.

Oil markets reacted strongly. US benchmark crude fell USD 4.77, or more than 4%, to USD 91.83 per barrel, while Brent crude declined USD 4.86 to USD 98.68 per barrel.

Currency markets also reflected changing sentiment. The US dollar slipped to 158.95 Japanese yen from 159.16 yen, while the euro strengthened to USD 1.1644 from USD 1.1605.

Investor confidence has also been supported by stronger-than-expected corporate earnings in the US, although inflation concerns remain amid ongoing geopolitical uncertainty.