Asian stocks leap and currencies rise after Trump says Hormuz will reopen
Asian stocks opened sharply higher on Monday with Japan's Nikkei up 2.4%, South Korea's Kospi up 3.1% and Taiwan's Taiex up 2.9%. Regional currencies firmed against the dollar, with the yen at 152.8 and the won at 1,342. Trump's statement that the US-Iran framework deal will reopen the Strait of Hormuz drove oil lower and revived risk appetite across the region.
Asian trading on Monday saw heavy buying on the open. Auto- and electronics-heavy Nikkei rose 2.4%, while Thailand's SET, Taiwan's Taiex and India's Nifty 50 all gained more than 2%. Trump's statement that the US-Iran framework will reopen the Strait of Hormuz signalled a critical decline in energy input costs for the region's exporters.
The yen weakened to 152.8 and the won fell to 1,342, while the Singapore dollar firmed. Investors are also pricing in possible monetary policy easing in the region, with the odds of a 25 basis-point cut by the Bank of Thailand on Wednesday climbing to 70%.
Analysts said that if the geopolitical détente holds and Brent settles around $60, the coming earnings season will be strong for Taiwan, Korea and Japan, especially in technology and autos. This article is not investment advice.
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