Asian Markets Rise, But Investors Remain Cautious as Iran-US Ceasefire Tensions Rise

JAKARTA - The Asia-Pacific stock market mostly opened stronger on Friday, but investors are not really calm. CNBC, quoted Friday, April 10, reported that the two-week ceasefire between the United States and Iran is still fragile, while traffic in the Strait of Hormuz remains very limited.

South Korea led the strengthening. The Kospi index rose 1.68%, while the Kosdaq increased 1.14%. In Japan, the Nikkei 225 rose 1.65%, while the Topix was flat. On the other hand, the Australian benchmark index S&P/ASX 200 fell 0.51%.

The market strengthening comes amid unsettled unrest. The conflict in the Middle East, which has lasted for more than a month, has triggered the closure of the Strait of Hormuz. Although a ceasefire was announced, the energy shipping route, which is very important, has not recovered to normal. The stock market may be green, but the sense of security has not really returned.

Tehran previously stated that it would reopen the Strait of Hormuz if all attacks on Iran were stopped. A number of media reports also said that Israel had agreed to the ceasefire, after US President Donald Trump halted attacks on Iran on Tuesday.

However, tensions have not really subsided. Trump on Thursday said Iran "better stop now" if it really charges oil tankers passing through the strait. A day earlier, Iranian Parliament Speaker Mohammad Bagher Ghalibaf accused the US of violating the ceasefire agreement.

Still referring to CNBC's report, oil prices reflect a still-restless market. West Texas Intermediate (WTI) crude rose 0.69% to US$98.55 per barrel at 20.41 US Eastern Time, after briefly breaking through US$100 per barrel at the start of the session. Brent also rose 0.91% to US$95.92 per barrel.

In Japan, Prime Minister Sanae Takaichi said her country would release oil reserves equivalent to 20 days' worth of needs starting in May. As of April 6, Japan has enough oil reserves for 230 days.

In Hong Kong, the Hang Seng futures contract was at 25,900, higher than Thursday's close at 25,752.40. In Australia, the benchmark index futures contract was trading at 8,995, while the S&P/ASX 200 previously closed at 8,973.20.

Last night on Wall Street, oil prices fell from their highest level, while US stocks strengthened. The S&P 500 rose 0.62% to 6,824.66, the Nasdaq Composite added 0.83% to 22,822.42, and the Dow Jones rose 275.88 points or 0.58% to 48,185.80. The Dow index is back in positive territory this year, albeit slightly, namely 0.25%.