End of war in the Middle East: oil falls 4%, markets in Europe and Asia are up
The crypto sector, too, has moved to robust growth
Donald Trump's statement about the end of the war and the imminent opening of the Strait of Hormuz caused oil prices to fall / Photo: Maksim Safaniuk/Shutterstock
World markets reacted with a rise in risk assets and a collapse in oil quotations to the news that the US and Iran had reached a peace agreement.
Details
- The cost of futures for Brent crude oil was falling at a low by the time of publication of this text by almost 5% - to $83.04 per barrel. U.S. WTI crude oil cheapened by 5.7% - to $80 per barrel. Quotes continue the negative dynamics of last week, as a result of which they fell to the lowest levels since March, notes Investing.com.
- European stock markets started trading on Monday with growth. The continent-wide Stoxx 600 index was up about 1.3%. Britain's FTSE 100 index was up about 1.6%, but then slowed to 9%. France's CAC 40 and Germany's DAX were each adding 1.8%.
- Shares in Asia rose sharply. South Korean Kospi index became the leader in the region, soaring by 5.2% at the end of the day. The Kosdaq index of small capitalization companies added 0.48%. Japan's Nikkei 225 rose 5%, while the Topix climbed 3%. Hong Kong's Hang Seng index strengthened 0.4%, while mainland China's CSI 300 index rose 2.2%.
- Bitcoin was up 2.3%, reaching its highest level in two weeks, Bloomberg writes. According to CoinMarketCap, the price of the largest by capitalization cryptocurrency at its peak was almost $66,000. The announcement of a peace agreement between the U.S. and Iran triggered a rally in the markets of risky assets. The world's largest cryptocurrency also benefited from a slowdown in capital outflows from spot exchange-traded funds, observed for the fifth week in a row, Investing.com specified.
- The yield on two-year U.S. Treasury bonds fell six basis points to 4.02%, while the yield on benchmark 10-year securities fell five basis points to 4.43%, Bloomberg reports. The yield on 30-year bonds also fell five basis points to 4.92%, the lowest since Ma. 7.
Context
The US and Iran have reached a peace deal after nearly four months of war, US President Donald Trump said on Sunday, June 14. "The deal with the Islamic Republic of Iran has been finalized," he wrote. Trump also noted that he had authorized the reopening of a key shipping route, the Strait of Hormuz, CNBC wrote. The official signing of the agreement will take place on Friday, June 19, in Switzerland, Pakistani Prime Minister Shehbaz Sharif said on social network X.
"The geopolitical risk premium that has [recently] been built into the price of crude oil is now being eliminated fairly quickly as traders focus on the prospect of oil flows recovering," KCM Trade senior market analyst Tim Waterer said as quoted by Reuters.
Trump's statement came in the wake of a firefight between Israel and the Tehran-backed Hezbollah group in Lebanon, which until the last moment created uncertainty around whether the deal could be finalized on Sunday, CNBC explains.
This article was AI-translated and verified by a human editor
