The Japan Times - Oil and stocks steady as US-Iran truce expiry looms

Iran had not yet sent a delegation to neighbouring Pakistan for a new round of peace talks with the United States, even as the two-week ceasefire is set to expire by Wednesday.

Brent North Sea crude, the international benchmark, was down around one percent after surging the previous day after Iran reclosed the Strait of Hormuz.

In Europe, the London, Paris and Frankfurt stock markets all traded higher in midday deals after gains in Asian markets.

"There is a reluctance for investors to price in the worst-case scenario for the conflict in the Middle East, and there is optimism within the market that the US/Iran ceasefire will be extended," said Kathleen Brooks, research director at trading group XTB.

The White House said Vice President JD Vance was ready to return to Pakistan for new negotiations to end a conflict that has sent crude soaring and revived inflation fears.

However, Iran's position remained uncertain as it accused Washington of violating their fragile truce through its blockade of the country's ports and the seizure of a ship.

US President Donald Trump has similarly accused Tehran of violating the ceasefire by harassing vessels in the Strait of Hormuz, the transit passage for about one-fifth of global oil.

Despite the uncertainty, analysts said investors remained largely upbeat that the two sides would eventually come to a deal that will reopen the strategic strait.

"Oil prices remained below $100 a barrel which suggests cautious optimism that the Middle East conflict won't intensify," said Russ Mould, investment director at AJ Bell.

"However, the longer oil remains in the 90s (dollar per barrel) range... the higher the chance of an inflationary shock and a wobble to global economic activity," he said.

Seoul led equity market gains in Asia thanks to a resumption of the tech rally that had propelled the Kospi to multiple records before the war, climbing 2.7 percent to hit an all-time high.

Tokyo and Taipei were also well up, with Hong Kong, Shanghai and Singapore also advancing.

Investors are also following the confirmation hearings for Kevin Warsh, Trump's choice to lead the Federal Reserve.

His testimony could shed light on the direction of US interest rates in the coming months, as the world's largest economy faces inflation risks and headwinds to growth.

But it comes as first-quarter earnings from dozens of companies have largely surpassed expectations, bolstering investor optimism that the Mideast War will not derail tech-led economic growth.

In Japan, defence firms saw healthy buying after Tokyo said it would ease decades-old export rules, paving the way for the sale of lethal weapons overseas.

- Key figures around 1100 GMT -

Brent North Sea Crude: DOWN 0.9 percent at $94.59 a barrel

West Texas Intermediate: DOWN 1.1 percent at $88.60 a barrel

London - FTSE 100: UP 0.1 percent at 10,617.00 points

Paris - CAC 40: UP 0.3 percent at 8,352.35

Frankfurt - DAX: UP 0.7 percent at 24,586.15

Tokyo - Nikkei 225: UP 0.9 percent at 59,349.17 (close)

Hong Kong - Hang Seng Index: UP 0.5 percent at 26,487.48 (close)

Shanghai - Composite: UP 0.1 percent at 4,085.08 (close)

New York - Dow Jones: FLAT at 49,442.56 (close)

Euro/dollar: DOWN at $1.1764 from $1.1786 on Monday

Pound/dollar: DOWN at $1.3514 from $1.3535

Dollar/yen: UP at 159.19 yen from 158.88 yen

Euro/pound: DOWN at 87.05 pence from 87.07 pence

M.Matsumoto--JT