Iran conflict impact on Asian stocks

What happened: On January 8, the U.S. and Iran agreed to a two-week ceasefire, reopening the Strait of Hormuz. This news drove Asian markets higher, with tech and semiconductor stocks surging. Airline stocks soared, led by American Airlines (+5.5%) and United Airlines (+7.2%). The S&P 500 and Dow Jones Industrial Average opened up 2.3% and 2.8% respectively, with the Nasdaq leading the rebound at 2.9%. Indian shares rallied 3.5%, while the CAC 40 in France rose nearly 1%.

Market impact: The ceasefire eased concerns about Hormuz disruption, benefiting energy-intensive industries like airlines and semiconductors. Crude oil prices plunged, boosting consumer and business sentiment. Tech stocks, particularly chipmakers, gained as global trade tensions eased. Indian shares benefited from lower crude oil prices, which account for a significant portion of India's import bill.

What to watch next: On January 22, the U.S.-Iran ceasefire is set to expire. Investors will closely monitor negotiations for a permanent resolution. On January 29, the U.S. releases its fourth-quarter GDP data, which could influence market sentiment. Additionally, earnings season kicks off in late January, with companies like Delta Air Lines and Intel reporting, providing further color on the impact of geopolitical tensions on corporate performance.