Tokyo Stocks Surge 2% as Oil Prices Rise Amid Geopolitical Tensions

Global markets opened with cautious optimism amid ongoing geopolitical uncertainty surrounding the Strait of Hormuz, which remains reportedly closed to free navigation. Iran denied direct talks with the US, while President Trump described Washington's approach as "semi-negotiating," emphasizing economic pressures on Iran and likening the situation to a chess game.

Asian stock markets rose, led by Tokyo's 2% gain, with Hong Kong up 0.6%, Shanghai 0.2%, and Seoul 0.7%. In South Korea, Samsung shares were stable, while SK Hynix edged up about 1%. Oil prices rebounded slightly after last week's 7% drop, with Brent crude near $84 per barrel and WTI around $78. Gold prices fell 0.3% to about $4,385 per ounce but remain near two-month highs due to lower US interest rate expectations and a weaker dollar.

US futures showed minor changes: Dow Jones contracts dipped 0.1%, S&P 500 was steady, and Nasdaq futures rose 0.2%. Last week, US indices posted strong gains, with the S&P 500 hitting a record high above 7,700 points, the Nasdaq up 5.2%, and the Dow rising 3%. Semiconductor stocks exited bear market territory, with ETFs like SOXX and IGV gaining 7.6% and 8.6%, respectively. Major chipmakers Nvidia, Intel, Marvell, and Arm all rose over 10%.

In Israel, dual-listed stocks are expected to open with a positive arbitrage gap of about 0.45%. Tower Semiconductor is forecast to rise 5%, while competitors Camtek and Nova may decline up to 2%. NICE is expected to gain over 4%, with Teva and Elbit Systems up about 1.5%. Key earnings reports today include Camtek, Nice, and drone camera maker Next Vision. The Tel Aviv market closed last week mixed: TA-35 rose 0.5%, TA-90 fell 2.2%, and TA-125 dropped 0.2%. The banking index led gains with a 2.4% increase, technology rose 1%, while construction and oil & gas sectors declined sharply.

Notable performers included El Al, which surged 20% after doubling its Q2 net profit, and Palo Alto Networks, which jumped 9% following its inclusion in major indices. Palantir had its best week since 2024, soaring 40% after strong Q2 results and contract wins exceeding $2 billion. Deutsche Bank upgraded Palantir to a buy, highlighting its unique AI capabilities, while William Blair noted its strong performance despite rising competition from Anthropic and OpenAI.