Turnaround in Iran Tensions Spurs Morning Rally in Japanese and South Korean Stocks

(CNA, Tokyo, 21st, Comprehensive Foreign Report) After Iran stated it was reviewing a new U.S. proposal aimed at ending the conflict in the Middle East, Japan's Nikkei index rose by over 3% in early trading today, and South Korea's KOSPI index also surged by more than 5%. According to Agence France-Presse, as of 00:30 GMT (8:30 Taiwan time), Japan's benchmark Nikkei 225 index was up 3.20%, before slightly paring its gains. South Korea's benchmark KOSPI index climbed 5.42%. Positive market news also included a tentative wage agreement reached between Samsung Electronics' management and labor on the eve of a strike, temporarily postponing the strike that was scheduled to begin today. U.S. President Donald Trump had earlier stated that negotiations with Iran are at a "critical point," with a deal being as possible as a resumption of military action. This mood of cautious optimism quickly spread through financial markets. International oil prices plunged by over 5%, and U.S. stocks rallied. However, analysts cautioned that investors should remain watchful after weeks of back-and-forth tensions. Trump had previously said that talks with Iran were in the "final stages," but subsequently warned that the diplomatic window could close soon. The Iranian Foreign Ministry noted that Tehran had "received the U.S. side's opinions" and was in the process of reviewing the content. According to an analysis by Japanese brokerage Monex, the rally in U.S. stocks, expectations of de-escalation in the Middle East, and falling oil prices were the main reasons for the strong buying and boosted investor confidence at the opening of the Tokyo market today.