The Hang Seng Index surged 1.4% on Tuesday, March 24, 2026, climbing to H$24,630 from a weekly low of H$24,215. This move mirrored a global equities rally, with the Dow Jones Industrial Average jumping over 600 points and the Nasdaq 100 and S&P 500 gaining more than 1%. The primary catalyst was a statement from former US President Donald Trump indicating he had deferred bombing Iran's power plants following talks between the US and Iran.
However, the optimism was met with immediate skepticism. Iranian officials denied the claims of ongoing talks, suggesting Trump's statement was a market manipulation tactic aimed at lifting equities and lowering energy prices before US markets opened. Iran has maintained control over the Strait of Hormuz, a critical oil chokepoint, keeping energy prices elevated. Following the initial rally, futures tied to major US indices dropped over 1%, and European indices resumed a downtrend. Crude oil prices, with Brent reaching $100 and WTI hitting $95, also resumed their upward trajectory.
The rally extended to the Nikkei 225 Index on Wednesday, March 25, which jumped 2.6% (up 5.5% from its weekly low) to approximately ¥53,600. This gain was again attributed to Trump's comments, including a claim that Iran had sent the US a "major oil-related gift." A potential US-Iran deal is seen as particularly bullish for oil-importing nations like Japan.
Analysts caution the gains may be short-lived. Beyond Iran's denials, reports indicate the US has presented a 15-point plan with conditions—such as ending ballistic missile programs and proxy funding—that Iran is unlikely to accept. Furthermore, Iran suspects the US may be using talks as a delay tactic while mobilizing troops. The head of Chevron warned that California faces a potential energy crisis, with 20% of its fuel coming from Asian markets affected by the Strait's closure.
Technically, both indices show bearish signals. The Hang Seng Index remains below its 50-day and 100-day Exponential Moving Averages (EMAs), with analysts targeting a potential drop to the H$24,000 psychological level. The Nikkei 225, while rebounding, also trades below its 50-day EMA, with key indicators like the Supertrend and RSI suggesting continued downward pressure and a potential retest of support near ¥50,557.
