Markets react positively to U.S.-Iran agreement

In Short:
– Markets reacted positively to a U.S.-Iran agreement to end four-month conflict, boosting stock prices.
– Both sides confirmed a memorandum for military de-escalation and reopening of the Strait of Hormuz.

Markets have reacted positively to a preliminary agreement between the U.S. and Iran aimed at concluding a nearly four-month war that impacted the global economy.Stock prices rose on Monday, accompanied by declines in oil prices and bond yields.

Agreement reached

No formal deal is signed yet, but both parties have consented to a “memorandum of understanding” and agreed to military de-escalation, as U.S. President Donald Trump announced.

Iran’s deputy foreign minister, Kazem Gharibabadi, confirmed that the text is finalised and a signing is scheduled for Friday in Geneva, declaring an immediate and permanent end to hostilities.

Trump stated that the U.S. naval blockade would also be lifted.

Details of the memorandum have not been disclosed, and information has been sourced from statements by negotiating parties.

Strait of Hormuz

While the Strait of Hormuz is not yet officially open, both Trump and Gharibabadi confirmed it will reopen following the signing in Geneva.

Trump announced on Truth Social that he authorized toll-free access to the strait and immediate cessation of the naval blockade.

He urged global ships to commence operations to facilitate oil transportation.

Iranian news reported that the reopening of the strait would depend on “Iranian arrangements.”

Qatar welcomed the U.S.-Iran agreement and highlighted the importance of ensuring freedom of navigation in the Strait of Hormuz.