Stocks and Bonds Rally as Oil Tumbles on Iran Strike Pause, KOSPI Rebounds

Bloomberg reported that a sharp drop in oil prices triggered a relief rally in stocks and bonds after a lull in Middle East hostilities, starting a week packed with earnings and rate decisions on a positive note.S&P 500 futures rose 0.8% and Nasdaq 100 contracts climbed 1.4%. Bond yields fell globally, with 10-year Treasury yields declining four basis points to 4.64%. Brent crude fell 6% to around $91 a barrel after the US paused strikes against Iran for a second night.KBC Securities' Andrea Gabellone said he expects a volatile week with the Fed, tech results, and European inflation data, adding the Iran situation remains fragile. Traders remain cautious ahead of megacap earnings from Amazon, Meta, and Microsoft, with the Fed's rate decision on Wednesday pricing a one-in-three chance of a hike.In Europe, the Stoxx 600 trimmed an early 0.8% advance to trade up 0.5%. ECB's Peter Kazimir warned policymakers will need to raise rates at least once more to contain inflation risks. CXMT surged as much as 535% in its Shanghai debut, while Nvidia is in talks to provide a $250 billion guarantee to help OpenAI lease computing from a data center project.According to Yonhap News Agency, South Korean stocks finished nearly 1% higher, with KOSPI adding 65.13 points to close at 6,755.75, rebounding from Friday's 5.72% drop. Samsung Electronics rose 1.8% and SK hynix jumped 3.24%. Naver surged 8.43% after announcing Nvidia's $1 billion investment. Oil refinery and defense shares tumbled, with SK Innovation down 10.3% and Hanwha Aerospace sinking 8.17%.Daishin Securities analyst Lee Kyung-min said solid AI investment and global tech collaborations offer upside pressure, though CXMT's listing would limit gains in Korean chip shares.