Equities climb as hopes of a diplomatic breakthrough push crude price lower

Market Commentary

Stocks surged across major indices on Wednesday, with Wall Street riding the momentum: the S&P 500, Dow Jones and Nasdaq each gained around 1%, fuelled by reports of a US plan to end the conflict with Iran, which sent crude prices tumbling.

The International Atomic Energy Agency's (IAEA) head, Rafael Grossi, told CNBC that Iran-US talks could materialise this weekend in Islamabad, building on the Trump administration's 15-point ceasefire proposal relayed through Pakistani intermediaries offering to host negotiations. The outline calls for Iran to halt regional proxy activities, stop arming militias, keep the Strait of Hormuz open, and restrict missiles to defence. In return, sanctions would lift, with support for a civilian nuclear programme in Bushehr.

European markets followed suit, with the STOXX 50 up 0.60% to 5 627 and the STOXX 600 climbing 1.20% to 586. London's FTSE 100 jumped 1.40% after a 0.70% rise the previous session. Banks spearheaded gains amid stabilising bond yields – ING, Deutsche Bank, Santander and BBVA rose over 2% – while industrials and chemicals advanced on cheaper natural gas, lifting Schneider, BASF and Siemens Energy 2.50%–4.50%. Grifols added 1.50% ahead of its US biopharma IPO.

Commodities reflected the de-escalation hopes: Brent crude plunged over 3%, though global energy strains persist. Chevron warned of a California fuel crisis, Australia faces widespread shortages, the Philippines has declared a national emergency, and Asian nations are stockpiling jet fuel.

Meanwhile, precious metals shone, with gold up nearly 2% at $4 562.50 per ounce, silver close to 2% and platinum gaining 2.48%.

Asian markets traded mostly higher on Wednesday, extending Wall Street’s gains as hopes grew that President Donald Trump’s tariffs may be moderated. The Hang Seng Index in Hong Kong, Japan’s Nikkei 225 and China’s Shanghai Composite Index each advanced by more than 1%.

South African equities also performed strongly. The FTSE/JSE All Share Index (ALSI) rose by more than 3%, while the FTSE/JSE Top 40 Index gained 3.46%. The FTSE/JSE Resources Index led the rally, surging 4.78%. The rand strengthened, trading at around 16.90 against the US dollar, 22.62 to the pound and 0.38% firmer to the euro.