China-Iran agreement sparks optimism, Asian stock markets approach historical highs.

Due to optimistic market expectations that the reopening of the Strait of Hormuz will restore oil supply and ease inflationary pressures, Asian stock markets are approaching historical highs. The MSCI Asia Pacific index stabilized after rising for five consecutive trading days. Boosted by the continuous rebound of chip stocks, the Korean Composite Stock Price Index (KOSPI) led gains in the Asia-Pacific region on Friday, rising by 2.6% to reach a new historical high. The Nikkei 225 index rose by 1.2% on Friday before narrowing its gains. On Friday, the stock markets in the United States and China were closed for the holiday. The Philadelphia Semiconductor Index rose by more than 6% on Thursday, with Intel Corporation (INTC.US) soaring over 10%. Prior to this, US President Trump stated that Intel Corporation will collaborate with Apple Inc. (AAPL.US) to design and manufacture semiconductors in the United States. Asian stock markets nearing historical highs The global markets experienced a pivotal week: the US reached a significant agreement with Iran, Fed Chairman Kevin Wash held the first policy meeting, and the Bank of Japan decided to raise interest rates to the highest level since 1995. Despite significant events occurring in the market, stocks continue to show resilience, with the MSCI Global Stock Index rising by 1.3%, heading for the best weekly performance of the month. On Friday, the price of Brent crude oil was around $79 per barrel. Oil prices fell by about 9% this week due to the temporary peace agreement between the US and Iran, which gradually restored normal shipping through the Strait of Hormuz and eased unprecedented supply shocks in the global oil market. Currently, the focus of the market has shifted to negotiations on the Iran nuclear program and the sustainability of the ceasefire agreement. Hiroshi Namioka, Chief Strategist at Tokyo T&D Asset Management, stated, "Following the US-Iran agreement, risks have eased, and investors seem to ignore the possibility of a Fed rate hike. Nevertheless, concerns remain high about the market's dependence on technology stocks. Micron's earnings report next week will be a litmus test for this rally, and if the performance falls short of expectations, there may be significant selling in the chip sector." The US Central Command announced the lifting of restrictions on traffic to Iranian ports and coastal regions on Thursday, while US Vice President Wans downplayed concerns about Iran eventually imposing tolls on this important energy channel. The recent selloff in oil has almost entirely erased the gains since the US and Israel attacked Iran in February. "The oil price has fluctuated significantly this week, partly due to the almost instantaneous resumption of Iranian oil supply," said IG Australia market analyst Tony Sycamore. "The next step is execution risk. There are still many details to be worked out." On Thursday, the yield on 2-year US Treasury bonds remained stable at around 4.18%. The previous trading day saw the yield surge by 13 basis points to the highest level in a year, as the market significantly raised expectations of future rate hikes due to the Fed's "hawkish pause." However, the price of 30-year US Treasury bonds rose, with the yield declining by 3 basis points to 4.9%, indicating that the market believes inflation will be controlled in the long term. Due to the US holiday, there were no spot transactions for US bonds during the Asian trading session. The Bank of England kept its benchmark interest rate unchanged at 3.75% on Thursday, stating that the recent downward trend in oil prices was "encouraging." However, two out of the nine members of the Monetary Policy Committee expressed concerns about persistent high inflation and advocated for an immediate 25 basis point rate hike. In the foreign exchange market, the Japanese yen remains a key focus. Japanese Finance Minister Kaga Tsukihime stated on Friday that, given the yen exchange rate approaching a forty-year low, the government can take bold actions to address speculative actions. Furthermore, the price of gold is expected to decline for the third consecutive week, as market bets on the Fed's hawkish stance and rate hike expectations overshadow the optimism brought by the peace agreement. The US dollar index remains stable and is expected to close higher for the week.