A brighter tone has returned to global markets after the Middle East ceasefire eased immediate fears of further escalation, lifting equities and sending oil prices sharply lower.
Industry professionals are reacting to the latest news below:
Matt Britzman, senior equity analyst, Hargreaves Lansdown:
“Global markets are edging higher this morning as investors respond to a ceasefire in the Middle East that gives President Trump a clear offramp and lowers the immediate risk of further escalation. The FTSE 100 has opened 2% higher, while US futures are pointing to an even larger jump when markets open later this afternoon. The S&P 500 notched its fifth consecutive positive session last night, with the index now on track to record a six-day winning streak if it can hold on to pre-market gains, something not seen since October 2025.
Oil prices have moved sharply lower as the ceasefire agreement marks the first meaningful step toward a potential resolution. News that all parties are now working toward reopening the Strait of Hormuz is another clear positive for market sentiment, even if energy markets remain cautious. There is still work to be done, though, and oil prices will likely remain elevated and choppy until there is a more permanent resolution. The return of free-flowing traffic through the Strait of Hormuz, without any Iranian tolls or controls, feels essential if oil prices are going to start trending back toward levels we saw before the conflict began.”
Chris Beauchamp, chief analyst at IG commented:
“Both sides will spin this as a win, but for investors the important thing now is whether the negotiations that begin this week will lead to a durable deal. There are some pretty steep hurdles to clear, on uranium, missiles and who controls the Straits of Hormuz, so we could be poised to repeat Tuesday’s drama some time in the second half of April. But for now stocks have the bit between their teeth and oil prices have fallen back below the totemic $100 level. Disruptions are bound to follow across the globe but progress on a sustainable deal might mean that markets might continue to look past these, just as they did with tariff uncertainty.”
Susannah Streeter, chief investment strategist, Wealth Club:
“A wave of relief has hit financial markets after threats of a devastating escalation of the war were replaced by a temporary truce. The FTSE 100 has jumped on the open, on the back of sharp gains for indices in Asia. The two-week ceasefire is likely to be fraught with uncertainty but for now there are hopes that it will be a precursor to a longer-lasting agreement. There is a chance that the cost-of-living crisis consumers are already having to deal with may not be quite as painful. UK gas prices have dropped sharply, down 17% as hopes grow that the disruption to LNG supplies will ease, but they still remain around a third higher than before the conflict. Shell has put a number on the initial disruption caused by the outbreak of war. It’s cut its first-quarter gas production outlook, after the attack on its facilities at the Ras Laffan plant in Qatar. The company initially said it would take 12 months to repair, but Qatari officials have said some of the damage at sites could necessitate multi-year reconstruction projects. Amid this uncertainty Shell has forecast that its integrated gas production would come in around 880,000 to 920,000 barrels of oil equivalent per day against previous estimates of 920,000 to 980,000.
It’s still a highly unpredictable situation and deep damage has already been done. This is also being reflected in oil prices. Iran will reopen the Strait of Hormuz under the deal, a pledge which sparked a sharp fall in Brent Crude from above $110 a barrel to $91. But it’s been creeping higher, as realisation dawns that allowing more tankers through won’t relieve the energy squeeze immediately. Oil and gas facilities have been damaged across the Gulf, refining capacity has been badly disrupted and there’s a long global queue of demand. It could take years for supplies to be restored to pre-conflict levels due to the extensive repairs which will need to be carried out. So, although prices at the pumps may ease off in the coming weeks, they still could remain stubbornly high if oil prices hang around this level. They are currently more than 35% higher than the level back in mid-February before tensions started to seriously ratchet up in the Middle East.
The jet fuel shortages airlines are grappling with are going to take months to solve, even if this agreement holds. Carriers have had to deal with a more than doubling of fuel costs since the conflict erupted and the threat of shortages lingers. This has been drummed home by the head of the International Air Transport Association, IATA. Willie Walsh has stressed that the region is critical for the global supply of refined products. As the war has put a chokehold on supplies from the Middle East, it’s caused other nations which produce jet fuel to impose export bans, causing trade to seize up further. It will take time to unwind panic positions, and for jet fuel prices to stabilise, so airlines are likely to continue to pass on the cost to passengers for the foreseeable future.
There is ongoing uncertainty about longer-term access to the Strait of Hormuz, now that Iran has weaponised access to it. The narrow waterway has now acquired a new nickname – ‘The Tehran Toll Booth’ with Iran already charging ships $1 million or more to pass through. Now there’s speculation that the US could demand charges from carriers using the Strait in return for safe passage, after President Trump seized on the idea at a press conference. It would be another twist in the tariff tale for the US administration.
Whatever the outcome, it’ll add to longer-term costs for ships using the strait, which is likely to be reflected in the prices of a whole raft of products going forward – from oil and gas to fertiliser and helium, a critical component for high-tech manufacturing. So although the crisis may start easing, chronic problems may remain.”
Stephen Dover, Head of Franklin Templeton Institute:
“US President Donald Trump announced today that the United States and Iran have agreed to a two-week ceasefire, tied to the reopening of the Strait of Hormuz. Markets immediately interpreted this as a de-escalation of the most significant macro risk: A supply shock. In response, oil prices fell sharply, while US equity futures moved higher.
What is the market really saying?
- The market is unwinding a war premium: The first-order effect is lower oil prices, reduced inflation fears, and a decline in the probability of an energy-driven growth scare. That combination is driving the equity rally and the drop in crude prices.
- This is bullish for the broad market near term: Lower energy costs ease pressure on consumers and business margins, particularly benefiting transportation, airlines, industrials and rate-sensitive growth stocks. The shift would improve both the earnings outlook and the inflation backdrop.
- The message is “less bad,” not “problem solved”: The ceasefire is temporary and conditional on Hormuz reopening and remaining open. Iran has framed this as a negotiating pause, not a resolution.
Why this matters for markets today
- Oil was the transmission mechanism: The conflict’s macro impact runs primarily through energy and trade flows. Disruptions have affected not just crude oil, but also liquified natural gas (LNG), fertilizer, helium and shipping costs. If oil prices continue to fall and logistics normalize, markets can begin to unwind stagflation risks.
- The inflationary backdrop marginally improves: A sustained retreat in oil prices would ease near-term inflation pressure at the margin. That does not suddenly change the outlook for Federal Reserve policy, but it reduces one of the clearest upside risks to US inflation.
- Breadth should improve if this ceasefire holds: A durable de-escalation would likely rotate leadership away from defensive and commodity-linked names toward cyclicals and quality growth.
- The damage is already done. Energy infrastructure across the Gulf has been hit, and restoring full production capacity will take time. Supply normalization won’t be immediate, which means that oil, natural gas and fertilizer prices probably won’t fall quickly back to pre-war levels.
What could go wrong?
- Hormuz is the key signal. The critical variable is not the ceasefire headline, but whether shipping flows, insurance costs and actual energy transit normalize. Confidence in safe passage remains uncertain.
- Oil prices remain elevated. Even after today’s decline, Brent crude remains well above its roughly US$73 pre-conflict level, indicating that some geopolitical risk premium persists.
- A China angle: Easing energy risk should stabilize China’s growth outlook and global trade flows ahead of the US-China summit later in May, lowering macro tail risk and potentially supporting a more constructive tone in negotiations.
- Things can reverse quickly. Any ceasefire breach, renewed infrastructure threats, or failure to meaningfully reopen Hormuz could rapidly reignite oil prices and macro volatility.
Investment implications
- Near term, we view the latest news as a risk-on shift. Markets should respond positively to the easing of immediate tail risks.
- Our calls for maintaining broad equity exposure remain. If de-escalation holds, the biggest beneficiaries would be the sectors most pressured by the spike in oil prices.
- Don’t declare victory yet. The right framing is relief rally first, potentially re-rating later.
- Focus on real-time indicators. In our view, crude oil prices, tanker traffic and shipping conditions will reveal more than political headlines.
The bottom line: Today’s ceasefire is clearly market-positive because it directly reduces the risk of an oil-driven inflation and growth shock. But given its temporary and conditional nature, it should be treated as a relief rally—not a definitive all-clear.”
John Wyn Evans, Head of Market Analysis at Rathbones, one of the UK’s leading wealth and asset management groups, said:
“The ceasefire has delivered sharp relief to markets, but the next fortnight is as much about fragility as it is about resolution. Investors will be watching three things closely. First, whether negotiations translate into any concrete progress rather than simply buying time; the fact talks are starting so quickly is positive, but expectations should remain low. Second, developments around the Strait of Hormuz: safe passage is critical, and any disruption would very quickly feed back into energy prices and inflation expectations. Third, the broader regional picture. Israel’s comments on Lebanon are a reminder that this is a pause in one conflict, not a return to stability.
“The market reaction makes sense – oil, gas and risk assets are unwinding worst‑case scenarios – but conditions remain far from normal. This is a tradeable calm rather than a durable peace, and it wouldn’t take much over the next two weeks to reverse today’s optimism.
“There is little certainty and any dust that settles could be quickly disturbed. It feels likely that we will be left with higher energy prices than before the conflict began, and central banks will be slower to cut interest rates – though they now have less cause to raise them.”
