Berliner Boersenzeitung - Oil sinks, Tokyo leads Asia stock surge on growing Mideast peace hopes

Risk sentiment was surging on hopes Washington and Tehran will conclude the conflict and reopen the Strait of Hormuz, which has been effectively closed since the start of March, choking off a fifth of the world's crude.

Optimism got a huge boost Wednesday when US President Donald Trump said an agreement was near, a day after he paused efforts to help stranded ships through Hormuz, which drew Iranian attacks and threatened their fragile ceasefire.

If "Iran agrees to give what has been agreed to" the war would be over, Trump said. But if not, the bombing would resume "at a much higher level and intensity".

He later told reporters: "We've had very good talks over the last 24 hours, and it's very possible that we'll make a deal."

US news outlet Axios cited two US officials as saying both sides were close to agreement on a one-page memorandum of understanding to end the war, open the strait and set a framework for more detailed nuclear talks.

Iran has yet to respond to the US offer, with foreign ministry spokesman Esmaeil Baqaei telling local media it was "still under review".

Parliament speaker Mohammad Bagher Ghalibaf, who has taken the lead in negotiations, warned Washington was trying to "force us to surrender".

Pakistani Prime Minister Shehbaz Sharif, a key figure in initial talks in Islamabad last month, said he was "very hopeful".

Oil prices tumbled more than two percent Thursday -- having fallen around 10 percent over the previous two days -- with Brent and West Texas Intermediate both below $100.

- Tech boom -

Investors, who have largely remained optimistic that a deal can be reached, tracked another record day on Wall Street and pushed Asian markets higher.

The gains have also been helped by a fresh wave of cash back into the tech sector as traders snap up all things AI, helped by standout earnings from US giants including Microsoft, Apple and Alphabet.

Tokyo's Nikkei soared more than five percent as investors there returned from a long holiday, with tech investment titan SoftBank rocketing more than 18 percent while chip-linked firms Tokyo Electron and Advantest also ratcheted up big gains.

Seoul extended Wednesday's surge that took it past 7,000 points for the first time, with Samsung also up following its meteoric rise to pass the $1 trillion market capitalisation mark.

Hong Kong, Shanghai, Sydney, Singapore, Taipei, Mumbai, Bangkok, Wellington, Manila and Jakarta were all up.

Paris and Frankfurt extended gains, though London dipped after rallying more than two percent Wednesday.

The prospect of cheaper oil prices tempered worries about inflation, which also helped gold rally more than three percent Wednesday.

Stephen Innes at SPI Asset Management said "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".

"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.

Investors in Tokyo were also closely watching the yen after speculation of intervention by the Japanese government to prop up the beleaguered currency.

The unit, which has been hit by surging oil prices and a rush to the safe-haven dollar, hit a 10-month high against the greenback Wednesday, in the latest of a series of spikes in recent days that have fuelled rumours that officials have provided support.

The government spent $32-$38 billion buying yen in the market last Thursday, local media reported, quoting Bank of Japan data.

Atsushi Mimura, Japan's top currency official, on Thursday declined to comment, local media reported.

- Key figures at around 0810 GMT -

West Texas Intermediate: DOWN 2.1 percent at $93.13 a barrel

Brent North Sea Crude: DOWN 2.1 percent at $99.19 a barrel

Tokyo - Nikkei 225: UP 5.6 percent at 62,833.84 (close)

Hong Kong - Hang Seng Index: UP 1.6 percent at 26,626.28 (close)

Shanghai - Composite: UP 0.5 percent at 4,180.09 (close)

London - FTSE 100: DOWN 0.4 percent at 10,395.28

Dollar/yen: DOWN at 156.26 yen from 156.39 yen on Wednesday

Euro/dollar: UP at $1.1764 from $1.1752

Pound/dollar: UP at $1.3617 from $1.3594

Euro/pound: DOWN at 86.39 pence from 86.45 pence

(A.Lehmann--BBZ)