US President Donald Trump speaks during the NCAA Collegiate National Champions Day event at the White House in Washington, DC, on April 21, 2026.
Brendan Smialowski | AFP | Getty Images
Donald Trump’s announcement that the ceasefire with Iran would continue for talks damped anxiety that the U.S. was about to resume strikes, but investors largely reacted with a shrug.
Asian stocks were mixed overnight, while European markets traded slightly higher and U.S. equity futures pointed to marginal gains.
International benchmark Brent crude and U.S. West Texas Intermediate futures whipsawed on Trump’s announcement, trading at $99.81 and $90.86 per barrel, respectively, as of 4:52 a.m. ET, as the prices remained elevated on the president’s insistence that a blockade of the Strait of Hormuz stay in place.
“What the market is really doing is trying to look past what’s going on in Iran and saying this situation is going to slowly resolve itself. It may take some time, but we’re getting closer and closer towards the end rather than the beginning — and now it’s on to turn the next page,” said Brian Stutland, CIO at Equity Armor Investments, told “Squawk Box Asia” on Wednesday.
Back to fundamentals
The Strait of Hormuz remains closed and, as long as it remains so, continues to severely restrict oil supply, thereby lifting inflationary pressures and weighing on global growth prospects.
“Markets perceive that the worst-case scenarios in this war are probably over,” Ray Farris, chief economist for Eastspring Investments, told “Squawk Box Asia,” as investors had expected Trump to find a way to extend the ceasefire.
“What we’re doing now is taking out all of those left-tail, worst-case, oil-at-$200-a-barrel risks, shifting the distribution of prices back and refocusing on earnings,” said Farris.
Grace Peters, co-head of global investment strategy at J.P. Morgan Private Bank, told “Squawk Box Europe” on Wednesday that investors are “going back to thinking about fundamentals” and “the bar for re-engaging with the conflict” has been raised.
Oil prices remain around $100 as uncertainty persists
“And obviously we’ve got this catalyst of earnings season,” she added, noting companies will report as the S&P 500’s price-to-earnings ratio has fallen below its five-year average.
“That confluence of that valuation opportunity with the earnings as a catalyst is obviously pushing the market higher,” Peters said. “Again and again, we see a geopolitical playbook where one-off events don’t dramatically impact markets. The recovery generally is quite swift.”
“We spend a lot of time with clients saying ‘Look, don’t over-index to one-off events… [and] don’t underestimate what’s going on beneath the surface’.”
Luis Costa, global head of emerging market strategy at Citi, told “Squawk Box Europe” he saw a similar dynamic.
“I would call it residual optimism,” he said. “Before the conflict, we were in an environment where… equity earnings expectations were being revised higher and higher at a much faster pace than [in developed markets].
“I do believe that, for EM assets in general, the same situation is still valid.”
Inventories can run dry
The prospects for further peace negotiations remain uncertain. An expected trip by Vice President JD Vance to Pakistan for a second round of talks with Iranian officials is being put on hold after negotiators from Tehran reportedly declined to participate.
“The fact that the ceasefire is extended implies there is no rise in the probability of fighting leading to significant damage to energy infrastructure,” Daan Struyven, co-head of global commodities research at Goldman Sachs, said on CNBC’s “Squawk Box Asia.”
But “on the negative side, the longer this [disruption] lasts, the more global inventories draw. You can’t draw inventories forever,” Struyven said.
“It’s a fairly broad-based and very intense commodity shock — and the problem for policymakers is that they don’t fully control the duration of this shock,” Struyven added, estimating Brent crude prices hovering at $80 a barrel by year’s end — about $20 higher than the forecast without the Hormuz shock.
