Global Stocks Rally After Trump Extends U.S.-Iran Ceasefire Indefinitely

Global stock markets rallied as U.S. President Donald Trump announced an indefinite extension of the ceasefire with Iran, easing fears of escalation in the Middle East just hours before the previous truce was set to expire. U.S. stock futures surged in response, with S&P 500 futures climbing 0.5% to 7,135.75 points, Nasdaq 100 futures advancing 0.6% to 26,802.75 points, and Dow Jones futures rising 0.5% to 49,575 points, according to reports from Investing.com. This positive shift followed a down day on Wall Street, where major indexes like the Dow, S&P 500, and Nasdaq each fell about 0.6% amid uncertainty over the ceasefire's fate.

The relief rippled across international markets. European stocks rose on Wednesday, reviving after investors welcomed Trump's decision as a de-escalatory move on the Iran-U.S. front, as reported by Asharq Al-Awsat. In Asia, Chinese stocks hit a three-month high, buoyed by gains in artificial intelligence and electronic chip sectors amid cautious optimism about avoiding a wider Iran conflict. South Korea's bourse also reached a new record high, led by surging battery stocks that offset pressures on semiconductors. U.S. futures turned green following the "unconditional" extension, signaling broad investor confidence in the temporary calm.

Trump's announcement came via social media, where he stated the U.S. would hold off on attacks at the request of Pakistani mediators, allowing time for Iran’s leaders to submit a unified proposal for discussions. The extension has no end date, creating space for negotiations after Iran rejected a second round of peace talks, which led Vice President JD Vance to cancel a planned trip to Islamabad. While the U.S. blockade on Iranian vessels remains in place, the move reduced immediate risks of renewed hostilities, though Iran's response and compliance from U.S. ally Israel remain uncertain.

Oil markets showed a more mixed picture amid the volatility. Prices continued to gain, breaking the $103 barrier on Thursday after faltering peace talks, even as U.S. crude inventories rose and exports hit record highs per Energy Information Administration data from Asharq Al-Awsat. The U.S. dollar strengthened to a 10-day high as a safe-haven asset, reflecting lingering tensions around the Strait of Hormuz. Investors now eye upcoming earnings from companies like Tesla, AT&T, Boeing, and GE Vernova, which could further influence sentiment.

This development matters for global economies heavily tied to energy and trade routes through the Middle East. Escalation fears had previously weighed on risk assets, but the truce extension has restored some stability, benefiting consumers and businesses wary of supply disruptions and inflation spikes from higher oil. Affected parties include energy-dependent nations, exporters, and sectors like tech and batteries that thrive in low-volatility environments. What happens next hinges on negotiation progress—successful talks could sustain the rally, while breakdowns might reignite safe-haven flows and market drops.