Overview
- Markets rallied on Wednesday after reports that mediators were making progress on a U.S.-Iran agreement for the Strait of Hormuz, which helped send Brent and U.S. crude sharply lower and supported equity gains.
- Falling oil prices pushed global bond yields down and markets pared the odds of a near-term Federal Reserve rate increase, removing a key constraint on risk appetite.
- Strong U.S. corporate results, including gains at Amazon and Palantir, reinforced appetite for AI-related names and concentrated flows into semiconductor and tech stocks.
- Seoul experienced intense intraday swings as heavy buying in chips and tech forced the Korea Exchange to trigger a five-minute buy-side sidecar to curb program buying; retail investors were net buyers while institutions and foreigners booked profits.
- Despite the rebound, risks remain because diplomatic progress is incomplete and large AI capital spending raises questions about when profits will follow, leaving room for renewed volatility if talks stall or earnings disappoint.