Volkswacht Bodensee - Oil prices rise on Iran peace worries, stocks build on tech rally

Despite Donald Trump's assurances that the United States and Iran are edging closer to ending their three-month-long war and reopening the Strait of Hormuz, crude investors appear unmoved as they await solid progress.

Unease on trading floors has risen this week after reports in Iran said it had broken off contact over Israel's attacks on Lebanon, which the US president denied on Tuesday.

"Fake News Reports that the Islamic Republic of Iran, and the U.S.A., stopped speaking a few days ago are false and erroneous," he wrote on his Truth Social network.

"The conversations between us have been going on continuously, including four days ago, three days ago, two days ago, one day ago, and today."

He added: "Where they lead, one never knows, but as I told Iran, 'It's time, one way or another, for you to make a Deal. You've been doing this for 47 years, and it cannot be allowed to go on any longer!'"

Israel is continuing attacks on Lebanon, jeopardising fragile truce between Washington and Tehran, while Iran fired missiles at nearby countries.

The president said he remained upbeat for a deal.

However, the US military said Tuesday it had "successfully defeated" a series of Iranian missile and drone attacks in the Gulf and conducted self-defence strikes on the country's Qeshm Island. Centcom also said three attack drones launched by Iran "toward civilian mariners" had been hit.

Uncertainty about a peace deal pushed oil prices up more than one percent, with both main contracts up around five percent this week.

However, stocks extended their breathtaking rally, fuelled by the tech sector and AI demand.

Tokyo climbed more than two percent, helped by a more than 11 percent surge in chipmaker Tokyo Electron, while Advantest also jumped.

Taipei was up a similar amount thanks to Taiwan Semiconductor Manufacturing Company's strong advance.

Shanghai, Sydney, Singapore and Manila were also up, though Hong Kong, Wellington and Jakarta retreated. Seoul was closed for a holiday.

"Equity markets are once again taking their cue from the technology sector rather than the geopolitical headlines," said IG chief market analyst Chris Beauchamp.

"Tensions surrounding Iran have done little to dent investor appetite, with a string of AI-related announcements providing a more compelling narrative for markets this week.

"The pattern is a familiar one: when Big Tech delivers, broader indices tend to follow."

He said sentiment was "anchored by a pipeline of AI-driven capital spending that shows no sign of slowing".

The gains followed another record for the S&P 500 and Nasdaq on Wall Street, where chipmaker Marvell Technology soared more than 32 percent after Nvidia CEO Jensen Huang hailed it as the next trillion-dollar firm.

Adding to the upbeat mood among equity traders was data showing US job openings jumped in April to their highest level in 23 months.

The reading comes ahead of employment data on Friday that could determine if the Federal Reserve will keep its benchmark rate stable or potentially hike borrowing costs to fight inflation.

The yen strengthened slightly, having come within a whisker of 160 to the dollar, amid speculation Japanese authorities could step in to support their currency following last month's intervention.

That came as the Japanese cabinet approved a $19 billion supplementary budget to support households struggling with soaring everyday costs driven by the Iran war.

- Key figures at around 0230 GMT -

West Texas Intermediate: UP 1.2 percent at $94.86 a barrel

Brent North Sea Crude: UP 1.0 percent at $96.97 a barrel

Tokyo - Nikkei 225: UP 2.6 percent at 68,452.45 (break)

Hong Kong - Hang Seng Index: DOWN 1.4 percent at 25,686.06

Shanghai - Composite: UP 0.2 percent at 4,084.37

Euro/dollar: DOWN at $1.1630 from $1.1634 on Tuesday

Pound/dollar: UP at $1.3472 from $1.3470

Dollar/yen: DOWN at 159.85 yen from 159.92 yen

Euro/pound: DOWN at 86.34 pence from 86.37 pence

New York - DOW: UP 0.5 percent at 51,307.79 (close)

London - FTSE 100: UP 0.3 percent at 10,373.51 (close)

B.Baumann--VB