The S&P/ASX 200 Index (ASX: XJO) has jumped 2.7% in early morning trade on news of a potential ceasefire in the Middle East.
Pakistan, the US and Iran have been talking in recent days about trying to find a ceasefire and it seems that something has been agreed.
Ceasefire agreed
In a post on Truth Social, President Trump said that he will not bomb Iran for two weeks, based on a 10-point proposal from Iran and assuming a “COMPLETE, IMMEDIATE, and SAFE OPENING of the Strait of Hormuz”.
Pakistan Prime Minister Shebaz Sharifsaid on X:
I am pleased to announce that the Islamic Republic of Iran and the United States of America, along with their allies, have agreed to an immediate ceasefire everywhere including Lebanon and elsewhere, EFFECTIVE IMMEDIATELY.
Delegations from the US and Iran will hold talks in Islamabad, the capital of Pakistan, on 10 April 2026 to further negotiate.
According to reporting to Al Jazeera, the Supreme National Security Council of the Islamic Republic of Iran said that for a period of two weeks, “safe passage through the Strait of Hormuz will be possible via coordination with Iran’s Armed Forces.”
So, there is a lot of noise being made about de-escalation and agreeing on a ceasefire. Time will tell how this plays out and if it is indeed an end to the hostilities.
But, markets aren’t waiting to find out how firm this truce is.
ASX 200 jumps
The ASX 200 is currently up by 2.7%, which is a very strong reaction and the market is hopeful that the worst of the effects are over.
One of the global impacts of the Middle East conflict was the oil price surging.
According to reporting by CNBC, the West Texas Intermediate crude futures sank 18% to US$93 per barrel, which is a pleasing response for future changes to fuel prices at the service stations.
Now we’ll have to see what happens with inflation and interest rates, but a step-back from conflict is a pleasing step to see.
There are a number of ASX growth shares and ASX dividend shares that look great value, in my opinion.
