Asian stock markets rose on Monday, tracking record closes on Wall Street as the S&P 500 and Nasdaq Composite continued to gain amid cautious optimism over a potential diplomatic breakthrough in the ongoing Middle East crisis.
The rally came despite renewed geopolitical tensions after Iran briefly closed the Strait of Hormuz over the weekend, just a day after reopening it. The move followed accusations of a blockade of Iranian ports by the United States.
Asian markets broadly advanced, with gains recorded in Tokyo, Hong Kong, Seoul, Shanghai, Sydney, Singapore, Mumbai, Wellington, and Manila, supported by a renewed tech-sector rally that had previously driven global markets before the conflict began on February 28.
However, European markets moved in the opposite direction, with declines recorded in London, Paris, and Frankfurt.
The US dollar also strengthened against major currencies after falling sharply late last week, as investors reassessed global risk sentiment.
Analysts said markets remain highly sensitive to developments in diplomatic negotiations and potential military escalation.
Chris Weston of Pepperstone noted that traders are closely watching whether the fragile ceasefire can hold through ongoing diplomatic efforts.
He said recent comments from Donald Trump, including social media posts suggesting possible escalation, were being interpreted by some investors as a negotiating tactic ahead of renewed talks.
Weston added that while markets are aware that negotiations are unlikely to be straightforward, sentiment remains vulnerable to sudden shifts.
US President Trump told AFP that a deal with Tehran was “very close,” insisting there were “no sticking points at all” remaining. However, Iranian officials rejected the claim, stating that their enriched uranium stockpile would not be transferred “anywhere.”
Iranian state media said there are currently no plans for Tehran to attend the next round of talks in Pakistan, with officials citing the US blockade of Iranian ports as a key obstacle.
News agencies Fars News Agency and Tasnim News Agency reported that the atmosphere around negotiations remains uncertain, with lifting the blockade described as a precondition for further dialogue.
So far, only one formal negotiating session has taken place — a 21-hour meeting in Islamabad on April 11 — which ended without agreement.
Despite diplomatic uncertainty, markets continue to balance hopes of a resolution with concerns over persistent geopolitical risks and energy supply disruptions.
