Sharp Gains in Asia: South Korean Stock Exchange Jumps 4%, Oil Prices Fall
Global markets show optimism amid progress on the Iran issue and strong financial reports. Asian markets are rallying, oil prices are declining, and the dollar has fallen below 3 shekels.
Trading review: current reports, trends, indices, stock prices, bonds, foreign exchange, commodities, and analyst recommendations. 08:19.
Optimism in the markets this Wednesday is driven by apparent progress on the Iran issue. The US military stated that the Strait of Hormuz is open for the passage of all commercial vessels, following Treasury Secretary Scott Bessent's claim that an agreement with Iran is near. This anticipation, combined with positive financial reports, sent Wall Street to sharp gains yesterday, an effect that remains significant this morning.
Trading in Asia opened with sharp gains. The Tokyo Stock Exchange jumped by 3%, the KOSPI index in South Korea added 4.1%, and the MSCI Asia-Pacific index (excluding Japan) rose by 2.4%. The blue-chip index in China also strengthened by 0.7%.
Market activity is influenced by reports published after the US close. AMD shares fell by about 8.8% in after-hours trading, as the company beat analyst forecasts but disappointed investors expecting even stronger results. SpaceX is losing 7.5% due to concerns over capital expenditures and their impact on cash flow. Nasdaq futures are trading almost unchanged, while S&P 500 futures are rising by about 0.3% after yesterday's record.
Wall Street closed with sharp gains last night, with the S&P 500 and Dow Jones indices setting new records. The S&P 500 climbed by 1.8%, the Nasdaq jumped by 2.7%, led by Palantir shares, which surged 29% after strong reports and raised forecasts. The Dow Jones rose 1.9%. The technology sector jumped 4%, while industrial and raw materials sectors added nearly 2% each. The financial sector rose 1%, and the Philadelphia Semiconductor Index (SOX) jumped more than 6%.
The reporting season continues to surprise to the upside: according to FactSet, more than 84% of S&P 500 companies have beaten analyst forecasts. Palantir was the star of the day, calming concerns about a slowdown in demand for artificial intelligence solutions. CEO Alex Karp described the quarter's results as "from another world" and noted that demand for "Sovereign AI" has been unleashed.
Despite the rally, famous investor Michael Burry maintains his bearish stance, warning that the market could end in a crash reminiscent of 1987. He continues to hold short positions against Nvidia, Tesla, and Palantir. Amazon shares fell about 2% after Jeff Bezos filed a plan to sell approximately $4.1 billion worth of company shares.
Oil and FX: Brent crude is falling 1.1% to $78 per barrel, while WTI trades around $74. The dollar is trading below 3 shekels for the first time in three weeks.
Tel Aviv: The local stock exchange is expected to see a positive impact. Bank managers may benefit from a new draft circular from the Banking Supervision Department, which would allow the application of American accounting rules, facilitating dual-listing abroad and increasing liquidity.
