The Japan Times - Oil up, stocks mixed on uncertain prospects for US-Iran ceasefire

With the Strait of Hormuz still blocked to Gulf energy transit, traders remain wary that strikes could resume -- even though Wall Street indexes are at record highs after recovering losses since the Middle East war erupted in late February.

But analysts say expectations are high that both Trump and Iranian authorities want to end a war that has sent oil and gas prices soaring, threatening economic growth worldwide.

Solid corporate earnings and AI enthusiasm have also bolstered investor confidence, with dozens of blue-chip firms beating forecasts and billion-dollar tech deals spurring optimism among investors that recent equity gains will hold.

Wall Street stocks opened higher, while most European markets were down slightly after a mixed performance in Asia.

"Most seem convinced that the war will soon be over, or that it will have little effect on the US economy, even if energy prices remain relatively elevated," said David Morrison, senior market analyst at Trade Nation.

Elon Musk's SpaceX said Tuesday that it would partner with the AI coding start-up Cursor with an option to buy the company for $60 billion, the latest sign of corporate confidence that artificial intelligence will continue driving growth.

But with Hormuz oil shipments still shut, the Asian and European countries that rely most on Middle East energy supplies are scrambling to cope with soaring inflation that could derail growth.

"The ceasefire extension hasn't done much to calm nerves given that worries remain about the impact of the energy squeeze on the global economy," said Susannah Streeter, chief investment strategist at Wealth Club.

Brent North Sea was once more above $100 a barrel while main US contract, West Texas Intermediate, traded back above $90.

Iranian gunboats attacked at least one container ship in the Strait of Hormuz on Wednesday, maritime agencies said, despite US President Donald Trump announcing he was extending a ceasefire to allow more time for peace talks.

Trump said the US blockade of Iran's ports would continue while Pakistani mediators try to revive dialogue.

"The US and Iran may be trying to shore up leverage and playing a game of who blinks first," said Christopher Wong, a strategist at Oversea-Chinese Banking Corp.

"Whatever the outcome, the suspense in the interim may see risk appetite being curtailed," he said.

Away from the war, investors are keeping tabs on the Senate confirmation hearings of Kevin Warsh, Trump's pick to replace Federal Reserve boss Jerome Powell, whose term ends in May.

Trump has assailed Powell for not cutting interest rates more aggressively, and told CNBC on Tuesday that he would be disappointed if Warsh did not swiftly lower borrowing costs despite rising inflation.

Warsh told lawmakers he would not be controlled by the president as he fielded questions on his assets and central bank independence during his first hearing.

In Europe, official data showed that Britain's annual inflation jumped to 3.3 percent in March as the Middle East war sent oil and gas prices surging.

And both Germany and Italy cut their GDP growth forecasts for this year and next.

- Key figures at 1340 GMT -

Brent North Sea Crude: UP 1.6 percent at $100.02 a barrel

West Texas Intermediate: UP 1.6 percent at $91.27 a barrel

New York - Dow Jones: UP 0.6 percent at 49,149.38 points

New York - S&P 500: UP 0.7 percent at 7,111.23

New York - Nasdaq: UP 0.7 percent at 24,435.87

London - FTSE 100: DOWN 0.1 percent at 10,486.87

Paris - CAC 40: DOWN 0.4 percent at 8,201.60

Frankfurt - DAX: DOWN 0.2 percent at 24,214.40

Tokyo - Nikkei 225: UP 0.4 percent at 59,585.86 (close)

Hong Kong - Hang Seng Index: DOWN 1.2 percent at 26,163.24 (close)

Shanghai - Composite: UP 0.5 percent at 4,106.26 (close)

Euro/dollar: DOWN at $1.1737 from $1.1749 on Tuesday

Pound/dollar: UP at $1.3517 from $1.3511

Dollar/yen: DOWN at 159.18 yen from 159.25

Euro/pound: DOWN at 86.83 pence from 86.96 pence

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H.Takahashi--JT