Japan's Nikkei Index Surges 4% to Record High of 62,000 Amid Hopes for US-Iran Peace Deal
Asian Markets Surge Amid Easing Tensions in the Middle East
Asian shares advanced on Thursday, May 7, amid growing optimism that the US and Iran were moving closer to a deal. The positive sentiment was evident in the Japanese stock market, where stocks surged more than 4% on Thursday. The benchmark Nikkei 225 crossed the 62,000 mark for the first time, driven by strong gains in basic materials, technology, and financial stocks.
The Topix index also gained 2.37%, while the Japanese electronics firm SoftBank Group jumped over 12%. Other notable gainers included electronics firm Ibiden, which soared 16%, manufacturing and metals company Mitsui Kinzoku, which climbed 15%, and chemicals and materials company Tosoh Corporation, which rallied 12%. Renesas Electronics advanced 13%. The strong performance of these stocks contributed to the overall market surge.
In contrast, Australia's S&P/ASX 200 rose 0.9%, while South Korea's KOSPI erased earlier gains to fall 1.11%. The small-cap KOSDAQ slipped 0.98%. The Indian stock market also started on a negative note, with the Gift Nifty index trading 0.30% or 74 points down to 24,442, compared to its previous close of 24,516.
Read also: Treasury Yields Experience Largest Increase in Two Weeks Following Release of Labor Market Data
US Stock Market Rallies on Easing Tensions
The US stock market also reacted positively to the signs of easing tensions in the Middle East, with the S&P 500 and the Nasdaq ending Wednesday at record highs. The S&P 500 advanced 1.46% to close at 7,365.09 points, while the Nasdaq jumped 2.03% to settle at 25,838.94 points. The Dow Jones Industrial Average rose 1.24% to finish at 49,910.59 points.
The rally in the US stock market was driven by robust earnings from Advanced Micro Devices, which triggered a rally in chipmakers and other AI-linked stocks. The recent de-escalation in the Middle East has helped global equities recover losses triggered by the war and climb to fresh highs, with softer oil prices easing inflation worries and reigniting enthusiasm around the artificial intelligence trade.
| Market Index | Change |
|---|---|
| Nikkei 225 | +4% |
| Topix | +2.37% |
| S&P/ASX 200 | +0.9% |
| KOSPI | -1.11% |
| KOSDAQ | -0.98% |
| S&P 500 | +1.46% |
| Nasdaq | +2.03% |
| Dow Jones Industrial Average | +1.24% |
Read also: US-Iran Tensions Spark Uptick in Oil Prices Amid Global Market Decline
The strong rally in the US stock market has continued in recent weeks, as investors shifted their focus away from the Middle East conflict and toward a solid first-quarter earnings season led by AI-driven companies. Meanwhile, US private payrolls recorded their biggest increase in 15 months in April, signalling continued resilience in the labour market despite economic uncertainty stemming from tensions with Iran.
Investor Takeaway
Asian markets are expected to continue their upward trend due to growing optimism about the US-Iran peace deal.
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