MSCI’s Asia-Pacific equity index gained 1.1%, with shares in Japan and South Korea rallying on optimism that an easing of the war will lower oil prices and support economic growth

Asian stocks rose and crude oil extended declines amid hopes for an Iran deal.

MSCI’s Asia-Pacific equity index gained 1.1%, with shares in Japan and South Korea rallying on optimism that an easing of the war will lower oil prices and support economic growth. Technology stocks led the gains.

Helping sentiment, Brent crude dropped 2.6% to $96.77 a barrel. Treasuries rose across the curve with the yield on the 10-year dropping one basis point to 4.28% as cheaper oil helps contain inflation. Gold bounced back after two days of losses to trade around $4,775 an ounce, while Bitcoin rose to around $74,400.

The markets really want to give peace a chance, accentuating the positives and downplaying the negatives as tensions between the US and Iran simmer away, said Kyle Rodda, analyst at Capital.com. Despite this, the risk for further volatility remains high, with headline risk continuing to drive the action.

Since the US and Israel launched the war in late February, U.S. has taken repeated steps to contain prices, including coordinating the largest-ever release of global emergency reserves. It has also eased some sanctions on Iranian oil shipments at sea in an effort to curb surges. Still, crude is holding near $100 a barrel on both benchmarks.

I do think that we are in a place where we have accomplished our objectives. We can start to wind this thing down, US Vice-President JD Vance said in response to a question about the higher energy prices Americans are seeing due to the war in Iran.

The Singapore dollar erased its gains after the country’s central bank tightened its monetary policy settings.