Asian stock markets rallied and oil prices fell sharply on Monday following reports that the United States and Iran have reached a peace agreement aimed at ending nearly four months of conflict.
The development triggered a rapid unwinding of the geopolitical risk premium that had weighed on energy and shipping markets.
Despite the market optimism, some investors cautioned that the agreement is yet to be formally signed.
Asian equities posted broad gains, while crude prices retreated as traders priced in the prospect of restored access to Persian Gulf shipping lanes and reduced supply disruption fears.
Despite the market optimism, some investors cautioned that the agreement is yet to be formally signed.
The preliminary nature of the deal means execution risks remain, and markets will likely remain sensitive to any delays or diplomatic friction before a binding accord is finalized.