Ceasefire between the US and Iraq triggers frenzy in Asian markets! Strategists warn: high oil prices are still a double-edged sword.

The US and Iran have reached a temporary ceasefire agreement, injecting a short-term boost into the Asian market. However, strategists warn that the sustainability of this stock market rally hinges on whether the Strait of Hormuz can quickly resume navigation. For Asian economies heavily reliant on Middle Eastern oil, the risk of high oil prices still looms large. Here are the main points from the strategists: IG International market analyst Fabien Yip: "There is certainly optimism at the moment, but given that oil prices are still high, we have not returned to where we were at the end of February." "We need to watch whether Iran is willing to open the Strait of Hormuz. Once oil tankers can pass through smoothly, the situation will become clearer." "The rebound in Asian stock markets may be higher than in Europe and the US, as Asia was most severely affected after the outbreak of the war. Tech stocks and artificial intelligence stocks are expected to benefit the most, as they were the sectors most severely sold off." "We may also see some people take profits during the rebound. Some investors will seize the opportunity to exit. Energy stocks may see profit-taking as they previously benefited from the rise in commodity prices." Lombard Odier Singapore strategist Homin Lee: "If the oil transport volume through the Strait of Hormuz can significantly increase, the market will see a rebound in the remaining days of this week." "Traders will push for the famous TACO trade and further reduce the Strait of Hormuz risk premium in key asset categories. However, the long-standing geopolitical uncertainty in the Gulf region will limit traders from further boosting the market, especially if negotiations do not progress rapidly." Vantage Global Prime senior market analyst Hebe Chen: After Trump announced this news, oil prices plummeted, giving the market a "much-needed breather." "But this 11-day window, while slightly restoring people's shaken confidence, is just a fragile recovery of confidence - it's a tactical breathing moment, not a structural transformation. We see people fleeing war avoidance strategies, but it's too early to believe in a story of eternal peace, as the Strait of Hormuz remains the world's most expensive 'hostage' fortress." Wilson Asset Management hedge fund manager Matthew Haupt: Market risk appetite will temporarily rise, "but everything still depends on whether the Strait of Hormuz can reopen... The next two weeks will still be full of suspense." "I started increasing my positions last night, and added a bit more this morning. I feel there will be some twists and turns before the final outcome." Sumitomo Mitsui Trust Asset Management chief strategist Hiroyuki Ueno: "This is good news for the market. The situation now seems to be calming down. Iran has actually sat down at the negotiating table, which is a step forward. People now generally believe that high oil prices will not last long." Stocks that were sold off during the market turmoil of the past month will be bought back, leading to a "considerable" rebound in the short term. In Japan, tech stocks and artificial intelligence stocks seem to be the best buys. "But things cannot be guaranteed to be smooth sailing from now on, investors should not be too hasty." Commonwealth Bank of Australia strategist Carol Kong: The forex market saw a sharp response, but "the key is that there is currently no plan on how this war will end. We still expect the United States to eventually have to take further action to end this war. Therefore, although the US dollar may weaken further in the short term, it will be difficult to sustain the decline." Valverde Investment Partners founder John Foo: "Trump TACOed again. The ceasefire news will stimulate some risk appetite trading, as this may alleviate the energy pressure in ASEAN and Northeast Asia." "Obviously, the market will focus on those decimated growth stocks and related industries, such as the tech industry in Northeast Asia, and the markets in Vietnam, Singapore, and Thailand." Mitsubishi UFJ Trust and Banking senior market strategist Ayako Sera: In Japan, "I think it is difficult for the Nikkei index to continue to rise to 60,000 points", unless "we start to see a real ceasefire... Currently, the market is basically in a euphoric mood." The USD/JPY exchange rate may fall to the low range of 158, but reaching the level of 157 may be difficult as the war has not completely ended. "Today, Japanese government bonds will be bought, but energy prices will not return to previous levels." The likelihood of a rate hike by the Bank of Japan has decreased, as the rationale for raising rates in the short term to curb inflation has weakened.