MSCI’s broadest index of Asia-Pacific shares outside Japan was up 2.7%, snapping a four-day losing streak

Stocks and bonds rallied at the ‌start of the Asian trading session on Wednesday on hopes of a de-escalation in the Iran war, while significantly better-than-expected economic data for March propelled a rebound in Korean and Japanese shares.

MSCI’s broadest index of Asia-Pacific shares outside Japan was up 2.7%, snapping a four-day losing streak as Kospi surged ​5.5%. The Nikkei 225 also climbed 3.9% at one point.

They’re still quite far apart in terms of what a truce means, or what ​peace means, but the market is embracing the fact that they are talking, said Rodrigo Catril, currency strategist at National Australia Bank in Sydney.

That’s ​a positive sign, at least in terms of signalling or willingness to end the conflict, he said, speaking on a podcast. Whether a compromise can be reached remains to be seen, he added. While this is all happening, attacks are continuing from both sides.

Brent crude futures moved 1.1% higher to $105.16 a barrel to retrace some of the previous day’s decline.

South Korean stocks were on track for their sharpest jump in two weeks, with Samsung Electronics surging 8% and SK Hynix up 7.8%, as exports soared 48.3% year-on-year in March, smashing market expectations, while a separate purchasing managers’ index (PMI) gauge showed the country’s factory activity expanded at ​the strongest pace in more than ​four years in March, led ⁠by semiconductor demand and new product launches.

In Japan, business sentiment among large manufacturers improved in the three months to March, according to a closely watched survey released on Wednesday, a sign that increasing economic uncertainty from the ​Middle East war has yet to hit morale.