Markets expected to remain cautious After Iran Ceasefire
Markets are expected to remain cautious despite U.S. President Donald Trump’s decision to go ahead with an Iran ceasefire and suspend planned strikes on Iranian infrastructure for two weeks. This follows mediation by Pakistan’s Prime Minister Shehbaz Sharif and Army Chief Asim Munir.
The report from Apex Research says the temporary pause, which Trump described as a “double-sided ceasefire” remains conditional on Iran agreeing to reopen the Strait of Hormuz.
It highlights the fragile nature of negotiations and the risk of renewed escalation should talks break down.
Adding to uncertainty, Trump had earlier warned that “a whole civilization will die tonight” ahead of the deadline, underscoring heightened geopolitical tensions and the unpredictable policy backdrop.
The abrupt shift from imminent military action to a conditional pause signals elevated headline risk with markets likely to remain sensitive to further developments, diplomatic responses from Tehran and any changes to the two-week timeline.
Against this backdrop, regional markets are likely to trade cautiously, with investors remaining defensive amid fragile negotiations and elevated geopolitical risk.
The FBM KLCI fell 0.24% on Tuesday, marking its fourth straight day of declines as investors remained risk-averse amid heightened geopolitical tensions in West Asia, dampening overall market sentiment.
Market breadth was negative, with 343 advancers versus 539 decliners. Sector-wise, Healthcare (+0.49%) and Transport (+0.42%) led gains, while Technology (-1.03%) and Utilities (-0.53%) were the main laggards.
Wall Street ended mixed on Tuesday, with the Dow slipped -0.18%, While S&P (+0.08%) and Nasdaq (+0.04%) edged higher as investors reacted to U.S. President Donald Trump’s decision to suspend planned attacks on Iranian infrastructure for two weeks (CNBC). Global oil prices fell sharply, with U.S. crude plunging over 14% to below USD100 per barrel after President Trump agreed to a two-week ceasefire with Iran, easing immediate supply disruption concerns (CNBC).In Europe, the pan-European STOXX 600 declined nearly 1% on 7 April as uncertainty surrounding the Iran conflict weighed on sentiment. Asian markets, however, were firmer, with the Nikkei 225 (+0.03%), Kospi (+0.82%), and Shanghai Composite (+0.26%) posting modest gains.
Sector focus. “We favour energy amid elevated Middle East tensions supporting near-term earnings. Plantations may gain from firmer CPO prices, while defensive utilities and telecommunications remain attractive amid heightened market volatility,” writes Apex.
Technical Commentary
“The FBM KLCI fell on Tuesday to mark its fourth consecutive day in the red. This marks a breakdown of the prevailing bullish structure and signalling a shift in market sentiment following recent volatility. Immediate downside risk now pivots to the next support at 1,665, where a break below this level would reinforce bearish momentum and indicate sustained downward pressure in the near term.”
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