Today Fundamental Analysis: Asian stocks extend their gains despite geopolitical tensions, Brent settles above $100

Asia-Pacific markets were mostly higher on Monday as investors remained focused on strong economic momentum and equity gains, despite renewed diplomatic setbacks between the U.S. and Iran and ongoing Middle East tensions. Japan’s Nikkei 225 rose 1.4% to a new record high above 60,900, while South Korea’s Kospi jumped 1.8%, also reaching fresh highs of 6,657.

U.S. stock futures were mixed early Monday as investors weighed renewed tensions in the Strait of Hormuz and stalled U.S.–Iran peace talks, which pushed oil prices higher at the start of a crucial week for markets. Dow futures slipped, while Nasdaq futures edged higher and S&P 500 futures were mostly flat. The cautious tone followed reports that President Donald Trump canceled planned in-person ceasefire talks with Iran.

Geopolitical tensions increased after Iran’s Revolutionary Guard reportedly boarded two container ships near the Strait of Hormuz, lifting WTI crude above $96 and Brent above $107 per barrel.

Despite the uncertainty, markets remain close to record highs after a strong April rally. Investors now turn their focus to a major week ahead featuring earnings from several Magnificent Seven companies and the Federal Reserve’s policy decision, which could be Jerome Powell’s final meeting as chair before Kevin Warsh is expected to take over.

Gold rebounded slightly at the start of the week, rising above $4,700 again. The move followed reports that Iran presented a new proposal on reopening the Strait of Hormuz and ending the war, which also helped ease oil prices and inflation concerns. This increased expectations that the Federal Reserve could still cut rates in 2026, adding further support for gold. However, gains may remain limited as geopolitical risks persist, with shipping disruptions in Hormuz and the U.S. naval blockade.

Investors are also waiting for the upcoming FOMC meeting, while stronger physical demand from India and China is providing an additional supportive backdrop for gold prices. Markets currently expect the Fed to keep rates unchanged this week, and futures suggest policy will likely remain on hold for the rest of the year. Traders see only a small chance of a rate hike by the end of 2026.

AUTHOR

Ghassan Albohtori 

Financial Market Analyst - STARTRADER

Ghassan Albohtori is a financial market analyst with experience in macroeconomics, investing, and currency trading. He conducts in-depth market research covering fundamental and technical analysis of different instruments to find major changes in market trends. Mr. Ghassan's main focus is the effects of economic data on different asset classes and how this affects prices.

Risk Disclaimer: This material is provided for informational purposes only and does not constitute a recommendation or investment advice. Trading financial instruments on margin involves substantial risk and may not be appropriate for all investors.