Asian stock markets witnessed a strong rally on Friday morning after reports emerged that former U.S. President Donald Trump had stepped back from plans to restart a bombing campaign against Iran, easing fears of a wider conflict in the Middle East.
Investors across the region welcomed the development, with major equity indices posting sharp gains as concerns over oil supply disruptions and geopolitical tensions temporarily eased.
Japan's Nikkei 225 led the advance among major markets, surging 2,053.64 points, or 3.20%, to trade at 66,270.91. The rally was driven by broad-based buying across technology, industrial and export-oriented stocks as investors returned to risk assets.
South Korea's Kospi recorded the strongest percentage gain among key Asian indices, jumping 577.41 points, or 7.44%, to 8,341.36. The benchmark index witnessed heavy buying in semiconductor and manufacturing shares as traders reacted positively to the improving global risk sentiment.
Taiwan's Taiex also traded firmly higher, gaining 892.76 points, or 2.07%, to reach 44,042.22. Technology stocks remained at the forefront of the rally, supported by renewed optimism in global markets.
Meanwhile, Hong Kong's Hang Seng Index was up 290.62 points, or 1.20%, at 24,539.91 around 7:00 AM IST, extending gains seen across the broader Asian region.
Market participants said the reduction in immediate geopolitical risks encouraged investors to move back into equities after several sessions of caution. Lower fears of an escalation in the Middle East also helped stabilize energy markets, reducing concerns about a sudden spike in crude oil prices.
The positive sentiment across Asia is expected to spill over into Indian equities as well. Gift Nifty trends indicate that domestic markets could open with a gap-up at the start of trading.
While investors remain watchful of developments in the Middle East, Friday's rally reflects a clear shift toward risk-taking as markets price in a lower probability of an immediate escalation in regional tensions.
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