Asian equity markets posted broad gains on Monday, driven by reports that diplomatic negotiations between the United States and Iran have made tangible progress.
The development helped ease investor concerns that the fragile peace process was at risk of collapsing, providing a fresh catalyst for regional risk assets.
The positive sentiment from the Middle East diplomatic front translated into higher share prices across the region.
MSCI’s broadest index of Asian shares outside Japan rose, reflecting a wider appetite for risk as geopolitical tensions appeared to cool.
Investors, who had recently shrugged off doubts over the ceasefire, responded to the latest updates with renewed confidence.
Oil prices retreated in tandem with the equity rally, as the prospect of a stabilized diplomatic relationship reduced the premium for geopolitical risk in energy markets.