Asian Equities, Government Bonds Rise on Hopes for Quick End to Mideast Conflict — Update

By Ronnie Harui and Sherry Qin

Asian equities and government bonds rose on Wednesday as hopes for a quick end to the Middle East conflict soothed concerns over elevated inflationary pressures driven by higher-for-longer oil prices.

President Trump told reporters in the Oval Office on Tuesday, "We'll be leaving very soon," saying the U.S. would leave Iran in two to three weeks. Trump plans to deliver a speech on Wednesday evening to provide "an important update on Iran," according to White House press secretary Karoline Leavitt. Meanwhile, Iranian President Masoud Pezeshkian said Tehran is ready to end the conflict but wants unspecified guarantees.

"More credible steps toward de-escalation are finally emerging, critically including on Iran's side," five members of Westpac Strategy Group said in commentary. "At the very least, markets have received a welcome jolt that is forcing a repricing in the distribution of outcomes" from the conflict, the members added.

South Korea's Kospi ended its losing streak and jumped 7.1%, Japan's Nikkei Stock Average rose 4.3%. Taiwan's Taiex Index added 4.4%, and Hong Kong's Hang Seng Index was 2.0% higher.

Risk sentiment spurred gains in chip stocks, which have been tied to the AI boom. Samsung Electronics rose 12% and SK Hynix gained 9.05%. Kioxia Holdings jumped 12%, and TSMC added 4.8%.

Energy shipping stocks also advanced, with Cosco Shipping Energy Transportation rising 10% in Hong Kong and China Merchants Energy Shipping gaining 10% in Shanghai.

Yields on 10-year Japanese government bonds fell 4.5bps to 2.310%, those on 10-year Australian sovereign securities declined 6bps to 4.9150%, and those on 10-year New Zealand government debt dropped 12bps to 4.6100%.

"The mood in markets was fairly jubilant" after Trump's remarks, said Capital Economics' Thomas Mathews. However, he warns that higher energy prices would remain an economic drag and keep major equity indices from immediately returning to their previous highs.

However, oil prices remained elevated after Trump told aides that he is willing to end the U.S. military campaign against Iran even if the Strait of Hormuz stays mostly closed, The Wall Street Journal reported, citing administration officials. Trump also urged other countries to launch their own operations to wrest control of the strait from Iran. The waterway handled around a fifth of global energy flows before the conflict.

Trump's suggestion that other countries could reopen the Strait of Hormuz is a "reminder that supply risks remain firmly in play," StoneX's Matt Simpson said in commentary. "If the U.S. were to step back without restoring flows through [the Strait of] Hormuz, the most likely outcome is persistently higher oil prices and renewed inflation pressures--a scenario markets may not be fully pricing," the senior market analyst added.

Front-month West Texas Intermediate crude oil futures rose 1.5% to $102.85 per barrel, and front-month Brent crude oil futures gained 1.2% to $105.19 a barrel, ICE data showed.

Asian currencies were mixed against the dollar. The U.S. dollar was 0.3% higher at 1,511.52 Korean won, but 0.3% lower at 60.39 Philippine pesos.

Write to Ronnie Harui at ronnie.harui@wsj.com and Sherry Qin at sherry.qin@wsj.com

(END) Dow Jones Newswires

April 01, 2026 00:56 ET (04:56 GMT)