Risk Appetite Weakens as U.S.–Iran Deadline Looms

Key Takeaways:

• Markets remain cautious ahead of U.S.–Iran ceasefire deadline

• Trump sets firm timeline for Strait of Hormuz reopening

• Iran rejects proposal, raising doubts over near-term deal

• Oil prices rise but momentum moderates amid uncertainty

Market Summary:

Global risk appetite remained subdued as market participants closely monitored developments surrounding ceasefire negotiations between the United States and Iran, with a key deadline for the reopening of the Strait of Hormuz set for later today.

Donald Trump said on Monday that talks with Iran were “going well,” while emphasizing that reopening the strait remains a top priority. However, he also outlined potential consequences should Iran fail to meet the Tuesday 8 p.m. deadline, warning that U.S. military action could escalate significantly, including targeting key infrastructure.

On the Iranian side, reports indicate that Tehran has rejected the proposed ceasefire terms. According to state media, Iran has demanded a permanent end to the conflict, the lifting of sanctions, and commitments toward reconstruction, along with guarantees for safe passage through the Strait of Hormuz.

With the deadline approaching and no clear agreement in place, market participants have adopted a cautious, wait-and-see stance, with sentiment remaining highly sensitive to incoming headlines.

Meanwhile, crude oil prices continued to edge higher, supported by ongoing supply disruption concerns. However, bullish momentum has begun to moderate as investors question the likelihood and timing of a ceasefire agreement.

The Strait of Hormuz remains the central catalyst for oil markets. Any confirmation of reopening would likely ease supply constraints and exert downward pressure on prices. Conversely, prolonged disruption or further escalation could sustain elevated price levels and volatility.

Overall, markets are expected to remain driven by geopolitical developments in the near term, with participants closely monitoring the outcome of U.S.–Iran negotiations for clearer directional signals.