President Trump announced the cancellation of a planned military strike on Iran, citing an agreement over the 'perimeters of a deal' that would include the complete opening of the Strait of Hormuz and an end to Iran's nuclear threat. Trump emphasized that the decision was contingent on the ability to rapidly finalize a deal, and noted Israel's commitment to the agreement. The reversal followed reports that Trump had previously ordered the military to prepare for what he described as 'the biggest attack since WORLD WAR II' [1].
The de-escalation led to a sharp decline in oil prices, with both WTI and Brent crude falling more than 4% in early Asia trading as investors repriced the risk premium. OPEC+ further calmed oil markets by approving a production quota increase of approximately 188,000 barrels per day starting in September. This output hike, agreed by Saudi Arabia, Russia, Iraq, Kuwait, Algeria, Kazakhstan, and Oman, completes the phased rollback of a 1.65 million bpd cut originally set in 2023 [1].
U.S. stock futures rallied on optimism over diplomatic overtures and cooling crude prices, which offered relief to investors concerned about inflation. However, Asian markets opened lower. In currency markets, Japan's finance minister confirmed a joint foreign-exchange intervention with the U.S. to support the yen, marking the first coordinated action since 2011. The dollar retreated sharply, trading at 157.84 yen on Monday, down from a near 40-year low of 164 last week [1].
Berkshire Hathaway shares reached an eight-month peak last week, closing at $511.54, which is 5.2% below the record close of $539.80 set on May 2 last year, the day before Warren Buffett announced he would step down as CEO at the end of 2025. Analysts suggest the rally may continue, as the stock remains behind the S&P 500 [1]. Additionally, AstraZeneca is reportedly considering a merger with Bristol Myers Squibb that could value the combined entity at roughly $400 billion, potentially making it one of the largest deals in history [1].
CONCLUSION
The cancellation of the planned U.S. strike on Iran and OPEC+'s decision to increase oil output have eased geopolitical and supply concerns, resulting in lower oil prices and a positive market response. U.S. stock futures rallied, while currency markets saw significant movement following joint U.S.-Japan intervention. Major corporate developments, including Berkshire Hathaway's share rally and a potential AstraZeneca-Bristol Myers Squibb merger, add further momentum to market optimism.