Brent crude oil pulled back from one-month highs on Tuesday as renewed diplomatic engagement in the Middle East helped ease persistent supply disruption fears.
The moderation in energy prices provided a tailwind for global equity markets, which staged a recovery after a three-day losing streak.
Investors appear to be rotating out of defensive positioning and back into risk assets as the immediate threat of a severe supply shock recedes.
The cross-asset reaction was broad-based.
Asian equity markets led the reversal, with the MSCI Asia-Pacific index (ex-Japan) bouncing back as sentiment improved.
In the US, stock markets staged a mid-session reversal, suggesting that the earlier selling pressure was largely driven by geopolitical anxiety rather than fundamental deterioration.