Australian and US markets surged following a two-week ceasefire between the US and Iran, alongside a temporary reopening of the Strait of Hormuz, as investors rushed to buy the dip and position for a normalisation in energy flows. That optimism now faces a test this week, with hopes of a more permanent truce fading after talks between Iranian and US delegates in Islamabad over the weekend failed to deliver a breakthrough.
The S&P 500 climbed 3.6% in its strongest weekly gain since November 2025, as investors rotated back into technology stocks at more attractive valuations. Semiconductor names were among the top performers, with the sector buoyed by Samsung’s standout earnings, which saw quarterly profits surge eight-fold year-over-year, largely driven by AI memory chip demand. Meanwhile, fresh investment commitments from Amazon and Meta helped ease concerns around the sustainability of chip demand.
Australian equities also rallied, rising 4.4% for the week in their strongest performance since May 2025, underscoring the market’s sensitivity to energy dynamics given Australia’s reliance on imports. Rate-sensitive sectors led the gains as markets scaled back expectations for RBA rate hikes in 2026 from three to two. Banks and real estate stocks were among the top performers, supported by better outlook for loan growth as rate expectations softened.
In the world of commodities:
Copper (WIRE) surged to just shy of US$13,000 per tonne, its highest in a month, as investors celebrated the ceasefire between US and Iran, likely expecting a near-term resolution. Higher oil prices for longer could lower global economic growth, which would be negative for Dr. Copper.
Gold (GOLD) rallied to as high as ~US$4,800 as investors dialled back interest rate expectations following the US-Iran ceasefire. Concerns around central bank monetisation also receded after the People’s Bank of China’s latest balance sheet update showed its strongest pace of gold accumulation in over a year during March.
Hydrogen (HGEN) firms surged over the week as Big Tech firms re-affirmed their intentions to invest heavily in AI infrastructure. Oracle also expanded its deal with Bloom Energy, an industry bellwether, to power its datacentres.
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