Global Stocks Hit Records as U.S.-Iran Deal Hopes Lift Markets

LONDON (Reuters) - World stocks reached record highs on Thursday as investors rallied on hopes of a U.S.-Iran agreement to reopen the Strait of Hormuz and extend a ceasefire, while artificial intelligence demand continued to drive technology shares higher.

The MSCI World Index climbed 1.2 percent to a new closing high, with the S&P 500 also extending its winning streak. The surge came as traders priced in a potential diplomatic breakthrough that could stabilize energy supplies and ease geopolitical tensions in the Middle East. The Strait of Hormuz, a critical chokepoint for global oil shipments, has been under threat of closure, but recent diplomatic signals suggested a deal was imminent.

Oil futures, however, moved in the opposite direction. Brent crude fell 3.5 percent for the week, dropping below $78 a barrel, as the prospect of reopened shipping lanes alleviated fears of a supply disruption. The decline in energy prices contributed to a broader market rally, with investors rotating capital out of safe-haven assets and into equities.

The technology sector led the advance, buoyed by continued enthusiasm for artificial intelligence infrastructure. Chipmakers and server manufacturers saw significant gains, with Dell Technologies rising 4.8 percent after announcing expanded production capacity for AI hardware. The AI-driven demand has become a primary engine for market growth, offsetting concerns over inflation and interest rates.

In Asia, markets followed the global trend. The Nikkei 225 in Tokyo and the Hang Seng Index in Hong Kong both closed higher, reflecting the positive sentiment spreading from Wall Street and European exchanges. Analysts noted that the combination of geopolitical de-escalation and robust tech earnings created a favorable environment for risk-on trading.

The potential U.S.-Iran deal remains the focal point of investor attention. While diplomatic channels have been active, no formal agreement has been signed. The extension of the ceasefire, which has held for several months, is seen as a precursor to broader negotiations regarding the Strait of Hormuz. A successful reopening would restore normal shipping patterns and likely stabilize oil prices in the long term.

Market participants are now watching for confirmation of the deal's terms. Uncertainty remains regarding the timeline for implementation and the specific security guarantees involved. If the agreement falters, oil prices could rebound sharply, potentially dampening the current market momentum. Traders will closely monitor diplomatic statements and energy data in the coming days to gauge the sustainability of the rally.