Tel Aviv stock market set for firmer open after US-Iran deal and oil slump

The Tel Aviv Stock Exchange is set to begin the trading week against the backdrop of a newly announced agreement between the United States and Iran. The deal has eased fears of a wider conflict and its spillover into the global economy, encouraging investors back into risk assets, although the full terms of the agreement are still unclear and trading is likely to remain cautious.

Early trading signals are positive overseas. Futures on the main Wall Street indexes are up, with Nasdaq futures jumping by nearly 2%. In Asia, sharp gains are being seen, especially in Japan and South Korea, where technology and chip stocks are leading the rally. Market participants are responding to the possibility of reduced tension in the Middle East, lower energy prices, and a gradual return of risk appetite.

The same trend is visible in currencies and oil. The dollar is weakening against the shekel and other major currencies as demand for safe-haven assets falls. Oil prices are also declining, reflecting expectations that the Strait of Hormuz could reopen and that supply disruption fears may ease.

In Tel Aviv, traders will also watch Israeli inflation data due later today, since it could affect expectations for the Bank of Israel’s next interest-rate decision.