Nikkei tops 62,000 as Tokyo leads Asia rally on Iran peace hopes and AI chip surge

TOKYO. The Nikkei 225 jumped 5.7 per cent past 62,000 points for the first time on Thursday, leading a broad rally across Asian markets as investors priced in an end to the US-Iran war and a fresh wave of AI demand. The benchmark closed the morning session at 62,915.87 according to AFP figures, with SoftBank up more than 15 per cent and chip-related firms Tokyo Electron and Advantest also posting double-digit gains.

Hong Kong's Hang Seng rose 1.5 per cent to 26,598.50, Shanghai composite gained 0.2 per cent to 4,167.62, and Seoul, Sydney, Taipei, Singapore, Wellington, Manila and Jakarta all clocked broad gains. The Korean Kospi extended Wednesday's surge past 7,000 for the first time after Samsung Electronics topped a $1tn market valuation.

Risk sentiment turned on Wednesday when President Donald Trump said an agreement with Iran was near, a day after he paused US efforts to escort stranded ships through the Strait of Hormuz. "We've had very good talks over the last 24 hours, and it's very possible that we'll make a deal," Trump told reporters in Washington.

Axios cited two US officials saying both sides were close to agreement on a one-page memorandum of understanding to end the war, reopen the strait and frame more detailed nuclear talks. Iranian foreign-ministry spokesman Esmaeil Baqaei said the proposal was "still under review". Iranian parliament speaker Mohammad Bagher Ghalibaf, who has led negotiations, warned Washington against trying to "force us to surrender".

Oil holds, gold lifts

Oil prices were flat on Thursday after losing roughly 10 per cent over the previous two sessions. West Texas Intermediate held at $95.08 a barrel and Brent North Sea crude was up 0.1 per cent at $101.32. The strait has been effectively closed since early March, choking off about a fifth of the world's seaborne crude. Gold jumped more than 3 per cent on Wednesday as the prospect of cheaper oil tempered inflation worries.

"Traders aggressively embraced the idea that the Iran war may finally be shifting from missile trajectories to negotiation tables, while the AI frenzy simultaneously poured jet fuel onto the risk rally," said Stephen Innes at SPI Asset Management. "The result was one of those rare sessions where nearly every macro domino fell in perfect sequence. Oil collapsed, bonds rallied, the dollar sank, gold exploded higher, and stocks surged."

Yen watch

The yen drew the closest scrutiny in Tokyo. The currency hit a 10-month high against the dollar on Wednesday, the latest of a series of spikes that have fuelled rumours of Japanese government intervention. Bank of Japan data quoted by local media showed the government spent $32-$38bn buying yen in the market last Thursday. Atsushi Mimura, Japan's top currency official, declined to comment on Thursday. The dollar traded down at 156.23 yen from 156.39 the previous day.

What happens next now hinges on Tehran. Pakistani Prime Minister Shehbaz Sharif, a key figure in the initial Islamabad talks last month, said he was "very hopeful". If Iran rejects the proposal, Trump has threatened that bombing would resume "at a much higher level and intensity". Asia's record close priced in the more optimistic outcome.