Mumbai: Global financial markets saw relief on Thursday after signs of progress emerged in talks between the United States and Iran.
US President Donald Trump said that discussions with Iran had reached the final stage and a possible agreement could be announced soon. His statement raised hopes that tensions in the Middle East may reduce.
Following the announcement, crude oil prices fell sharply in international markets.
US crude oil (WTI) dropped by nearly USD 5.89 and traded around USD 98 per barrel. Brent crude oil prices also slipped and moved close to USD 105 per barrel.
Oil prices had risen strongly over the past few weeks because of fears linked to tensions in the Middle East.
Trump Warns Iran About Further Action
Trump said the US was still waiting for Iran’s final response and added that America would give Tehran a few more days before making any major decision.
At the same time, he warned that if Iran refused to cooperate, more attacks could take place in the future.
His comments created uncertainty but also increased investor confidence that a full-scale conflict might still be avoided through negotiations.
Stock Markets And Tech Shares Rise
The fall in oil prices improved investor sentiment across global stock markets.
The Nasdaq index in the US performed strongly, led by gains in technology and chip-making companies.
Shares of AI chip giant NVIDIA rose after the company gave a better-than-expected earnings forecast. NVIDIA also announced an $80 billion share buyback programme.
Experts believe lower oil prices could help reduce inflation pressure in many countries. This may also reduce the need for central banks to raise interest rates aggressively.
Dollar Weakens, Bond Market Sees Relief
The US dollar weakened during trading, while currencies such as the euro and Japanese yen strengthened.
Meanwhile, yields on US 10-year government bonds also declined after recent sharp increases caused by fears of war and inflation.
Investors are now closely watching further talks between the US and Iran, as any agreement could bring more stability to oil prices and global financial markets.
