Morning Brief: Iran Deal Hopes Lift Global Equities; Brent Crude Plunges Over 7% Below $100

Key Snapshot

🕊️ Senior Iranian envoys travel to Doha to hold peace talks with Qatar’s Prime Minister. The U.S. and Iran are discussing a plan to reopen the Strait of Hormuz around 30 days after a peace accord takes effect.

📈 The pan-European STOXX 600 posts a sixth straight gain and closes 1% higher, fully erasing losses incurred since the Iran conflict broke out. The MSCI All Country World Index hits a fresh all-time high.

🛢️ Brent crude futures tumble 7.14% to settle at $96.14 per barrel, falling firmly below the $100 mark.

🏛️ Germany’s 10-year bund yield drops 10.5 basis points to 2.93%, its lowest level since April 8.

I. Market Outlook

Core Events

Iran’s chief negotiator and Foreign Minister arrive in Doha to negotiate a war-ending deal with Qatar’s Prime Minister. Citing Middle Eastern diplomatic sources, Nikkei reports the two sides are discussing a timeline to reopen the Strait of Hormuz roughly 30 days after signing a ceasefire agreement.

Washington and Tehran had previously played down prospects of an immediate breakthrough. Senator Rubio pledged to push diplomatic efforts forward by all available means. Meanwhile, Trump has called on Saudi Arabia, Qatar, Pakistan, Turkey, Egypt and Jordan to join the Abraham Accords and normalize diplomatic ties with Israel, a proposal that Pakistan has formally rejected.

Market Reaction

U.S. markets are closed for a holiday, while U.S. equity futures rise by at least 0.9%. The STOXX 600 extends its rally to six consecutive sessions with a 1% gain, wiping out all conflict-related losses. Brent crude slides 7.14% to $96.14/bbl. Germany’s 10-year bund yield falls 10.5 bps to 2.93%. EUR/USD climbs 0.35% to 1.1643.

II. Overnight Market Action

Summary

Broad optimism over a potential U.S.-Iran deal lifts global stocks, sends crude oil sharply lower and drives European bond yields markedly down.

U.S. Equities: Markets closed. U.S. index futures rise over 0.9%, pointing to a strong opening ahead.

European Equities

• STOXX 600: +1% to 631.63, less than 1% away from its February record peak
• Germany DAX: +2.01%
• France CAC 40: +1.76%

💡 European shares extend their winning streak to six days. Banking stocks rise 2% to lead the rally. Air France-KLM surges more than 6% on cheaper fuel costs, and chipmaker Infineon gains 4.5%. The pan-European benchmark has fully recovered losses since the Iran conflict began, as investors price in growing odds of a finalized peace deal.

Fixed Income

• Germany 10-year bund: -10.5 bps to 2.9302%, the lowest reading since April 8

💡 Easing geopolitical risks combined with growth concerns trigger a strong rally in German bonds. A 10.5 bps single-day decline reflects dual bets on de-escalating tensions and slower economic expansion.

Commodities

• Brent July crude: -7.14% to $96.14/bbl
• COMEX June gold: +1.1% to $4,573.6/oz
• COMEX July silver: +2.9% to $78.4/oz

💡 Brent crude collapses more than 7% and breaks below $100, as traders aggressively front-run the 30-day reopening plan. Gold moves higher alongside falling oil prices, revealing a complex macro backdrop: markets continue to price in potential Fed rate hikes even as a diplomatic resolution draws near.

FX

• USD/JPY: -0.19% to 158.89
• EUR/USD: +0.35% to 1.1643
• GBP/USD: +0.55% to 1.3501

💡 The U.S. dollar weakens as investors move away from traditional safe-haven assets amid calmer geopolitics. Euro strength persists despite falling bund yields, signaling conviction that Europe’s toughest economic phase is over.

III. Macro Headlines

🕊️ Senior Iranian officials hold peace talks in Doha; U.S. and Iran discuss reopening the Strait 30 days post-deal Nikkei’s diplomatic sources confirm the proposed timeline. Rubio reaffirms commitment to diplomatic solutions.

Insight: The 30-day buffer represents a key compromise between the two sides. For markets, the blockade will remain in place for another month at minimum, even with an early deal. Oil’s steep decline reflects bets on near-term diplomatic progress, not an active shipping lane.

🇮🇱 Trump pushes six nations to join the Abraham Accords and normalize ties with Israel; Pakistan turns down the request Saudi Arabia, Qatar, Turkey, Egypt and Jordan have yet to issue official responses. Insight: Trump is linking Iran peace talks with Arab-Israeli rapprochement. Pakistan’s rejection highlights divergent stances across the Middle East. Given its long-standing ties with Iran, Pakistan will not move to normalize relations with Israel while hostilities continue.

🇷🇺 Russia threatens systematic strikes across Kyiv and urges foreign citizens to evacuate The announcement comes after one of the largest bombardments since the start of the Russia-Ukraine war. Insight: Escalation in the Ukraine conflict has drawn little market attention. Marginal developments on the Iran front now dominate global asset pricing, and the latest strike threats have failed to spark safe-haven demand.

🇯🇵 Japan plans a ¥3 trillion ($190 billion) supplementary budget, stoking worries over fiscal expansion Prime Minister Sanae Takaichi confirms the extra spending plan.

Insight: The large supplementary budget signals aggressive fiscal stimulus, which clashes with the Bank of Japan’s monetary tightening stance. This policy divergence will keep weighing on the yen, and market interventions cannot fully reverse depreciation pressure.

🇩🇪 EY data: Germany attracted 548 new foreign investment projects in 2025, down 10% year-on-year This marks the eighth consecutive annual decline and the lowest figure since 2009. The AfD chair blamed high taxes and elevated energy costs for eroding Germany’s competitiveness.

Insight: Foreign investment has slumped to a post-financial-crisis low, putting Germany under dual pressure from deindustrialization and capital outflows. China has overtaken the U.S. to become Germany’s top source of foreign investment, a shift with notable symbolic meaning.

IV. Corporate Headlines

🇰🇷 A new labor agreement at Samsung Electronics creates internal divisions. Chip staff qualify for special bonuses of up to ₩600 million, while consumer electronics employees see negligible benefits. The consumer electronics union has filed a lawsuit to overturn the voting result, and minority shareholders argue the deal lacked proper shareholder approval.

— The rift between Samsung’s chip and consumer electronics divisions mirrors broader economic polarization in South Korea. The AI boom has boosted semiconductor earnings, while traditional consumer electronics businesses continue to struggle, creating two vastly different working environments within one group.

🛢️ Swiss commodity trader Lytton SA purchases Iraqi crude at a $18 per barrel discount to benchmark prices, then ships the cargo via the Strait of Hormuz to Vietnam, generating around $60 million in gross profit. Freight costs range from $35 million to $40 million, eating into most margins.

— The $18 per barrel discount is a clear reflection of the geopolitical risk premium for shipments through the Strait. While gross profits appear sizable, freight expenses account for nearly 70% of total revenue. This is pure risk arbitrage, reserved for traders willing to navigate high-risk shipping routes.

V. Key Focus Today

📊 U.S. March House Price Index: Price movements amid elevated interest rates will shape the Fed’s assessment of housing-driven inflation.

📈 U.S. May Conference Board Consumer Confidence: The University of Michigan gauge has already hit a record low of 44.8. The latest reading will verify whether weak consumer sentiment is a broad-based trend.

🕊️ U.S.-Iran Negotiations: Monitor fresh progress following Doha talks and whether both sides formally adopt the 30-day delayed reopening plan.