By Ronnie Harui
Asian equity markets rebounded Tuesday, an abrupt U-turn from the prior day after President Trump said that the U.S. military would postpone strikes on Iranian energy infrastructure for five days.
In a Truth Social post on Monday, Trump said the U.S. and Iran had "very good and productive conversations regarding a complete and total resolution of our hostilities in the Middle East." Trump later said Iran wants to "settle" the war. Meanwhile, Iran's Foreign Ministry denied Tehran was in talks with the U.S., according to state media, though he said countries in the region were trying to get diplomacy going.
Japan's Nikkei Stock Average rose 0.6% in early trade after falling 3.5% on Monday and South Korea's Kospi climbed 0.8% following the previous day's 6.5% drop. Australia's S&P/ASX 200 benchmark index advanced 0.2%.
"Despite the lack of a consistent narrative [between the U.S. and Iran], markets have taken the good news at face value," National Australia Bank's Sally Auld said in commentary. "News that other countries were attempting to de-escalate the war was also well received," the group chief economist added.
Egypt, Turkey and Pakistan have been talking separately to U.S. special envoy Steve Witkoff and Iranian Foreign Minister Abbas Araghchi. Egypt also spoke with representatives of Iran's Islamic Revolutionary Guard Corps, The Wall Street Journal reported, citing Arab officials.
Despite the relief rally in Asian equity markets, however, crude oil futures recovered following Monday's decline as doubts emerged over whether the U.S. and Iran could reach a near-term resolution to the Middle East conflict.
"It is unclear how far back-channel talks have progressed or if the IRGC is in any mood to settle at this stage when they remain in firm control of the Strait of Hormuz," the RBC Capital Markets' Research team said in a report.
"We are skeptical that we are just days away from a lasting deal," the members said. "The Israelis are continuing with their attacks on infrastructure sites, today hitting multiple targets around Tehran, with widespread blackouts reported," they added.
The Israeli military said it was engaging in fighting with Hezbollah in southern Lebanon. The latest fighting came after the Israeli military earlier said it had launched attacks on Hezbollah infrastructure in Beirut.
Front-month West Texas Intermediate crude oil futures rose 3.6% to $91.29 per barrel after dropping 10.3% on Monday, ICE data showed. Front-month Brent crude oil futures added 3.0% to $102.96 a barrel following the prior day's 10.9% decline.
Write to Ronnie Harui at ronnie.harui@wsj.com
(END) Dow Jones Newswires
March 23, 2026 21:33 ET (01:33 GMT)
Copyright (c) 2026 Dow Jones & Company, Inc.
Comments