HSI surges 2% to 24,734 as Iran deal optimism lifts Asian markets

The Hang Seng Index surged 2% to 24,734.64 on Friday, tracking a broader Asian equity rally after President Donald Trump said the US was nearing an agreement with Iran.

"While the path toward a resolution is likely to be uneven, our base case is that diplomacy ultimately prevails, allowing investors to refocus on resilient economic fundamentals and strong earnings growth," said Ulrike Hoffmann-Burchardi, global equities CIO at UBS Global Wealth Management.

The rally swept across the region. South Korea's Kospi surged 8%, the most in two months, as a barometer for AI-linked semiconductor stocks. Japan's Topix added 1.6%, Australia's S&P/ASX 200 rose 1.9% and the Shanghai Composite climbed 1.8%. Euro Stoxx 50 futures pointed to a 1.7% gain at the open.

A diplomatic resolution would remove a major overhang for global markets, lowering the risk of energy-supply disruptions that had pushed Brent crude above $90 a barrel. Brent fell 1.3% to about $89.10 on Friday, while gold slipped 0.5% to $4,192.23 an ounce.

The de-escalation followed Trump's statement on his social media network that "discussions and final points have been, in both concept and great detail, approved by all parties involved," with a signing ceremony potentially as soon as this weekend in Europe. The comments marked a sharp reversal from hours earlier, when the president had threatened to bomb Iran and seize its oil infrastructure.

In Hong Kong, the rally pushed the HSI to its highest level in weeks, with turnover expected to exceed the 20-day average as institutional buyers rotated back into risk assets. The advance tracked a strong session on Wall Street, where the S&P 500 jumped 1.4% and the Dow Jones Industrial Average added 839 points, or 1.7%, after Trump called off threatened military strikes.

Cross-Asset Ripples

The dollar edged up 0.1% after four days of declines, with USD/CNH trading at 6.7658. The yield on the 10-year US Treasury rose one basis point to 4.47%, paring Thursday's decline. Lower oil prices eased upward pressure on inflation expectations, with the European Central Bank having raised rates last month as the first major central bank to respond to energy-driven price pressures.

Tech and IPO Spotlight

Investor attention also turned to SpaceX's debut on the Nasdaq later Friday, after the company raised $75 billion in the world's largest initial public offering at a valuation of $1.77 trillion. Perpetual futures tied to SpaceX were trading around $173 on crypto venue Hyperliquid, implying a valuation above $2.2 trillion. The listing is expected to remove a "liquidity overhang" that weighed on markets and contributed to this week's retreat in tech stocks, said Billy Leung, an investment strategist at Global X Management.

This article is for informational purposes only and does not constitute investment advice.