US-Iran talks lift Asian markets as oil riskeEases

Fidelity

Asian stocks rose on Monday as progress in talks between the United States and Iran helped calm investor concerns over the risk of disruption to oil supplies and regional trade routes.

The improvement in sentiment came after Iranian negotiators said discussions with the United States had made progress. Officials from Qatar and Pakistan also indicated that an initial round of talks had ended with movement towards a roadmap for a final agreement within 60 days.

Oil prices moved lower as traders adjusted to the prospect of reduced supply risk. Brent crude fell to $79.01 a barrel, while the most active US crude contract declined to $75.29 a barrel.

Asian equity markets gained across the region. Japan’s Nikkei rose as investors continued to back large-cap shares, while South Korean stocks advanced with support from technology and semiconductor names. A wider Asia-Pacific index outside Japan also strengthened, and Chinese blue chips moved higher.

When geopolitical risk appears to fall, investors are more willing to buy equities, especially in markets where earnings or sector momentum remain supportive. Lower oil prices can also help parts of Asia by reducing pressure on import costs, inflation expectations and consumer spending.

Fidelity Asian Values Plc (LON:FAS) provides shareholders with a differentiated equity exposure to Asian Markets. Asia is the world’s fastest-growing economic region and the trust looks to capitalise on this by finding good businesses, run by good people and buying them at a good price.

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