Oil price tumbles and stock markets soar on hopes Middle East war will end soon – business live

Gold is firmer even as Middle East de-escalation talk drives a broad risk rally: after rising 3.5% yesterday, gold is up another 0.8% to above $4,700/oz, leaving it at a near two-week high. The move suggests the market is still balancing geopolitical safe-haven demand against the prospect that a softer oil backdrop could eventually ease inflation and bring forward Fed rate-cut expectations later in 2026. The article frames gold’s bid as a two-way trade. IG’s Tony Sycamore argues that if a lasting peace agreement emerges, the loss of the geopolitical risk premium would weigh on bullion, but lower oil prices and reduced inflation pressure could support gold via easier monetary policy expectations. He also points to continued structural support from central banks, which have been accumulating gold for diversification. Near term, gold will likely trade on headlines from Washington and Tehran, with President Trump expected to address the US later today. If the market continues to price a faster end to the conflict, the safe-haven bid could fade; if talks stall or rhetoric hardens, bullion could extend higher. For now, the key watchpoints are oil, inflation expectations and any change in rate-cut pricing as risk assets rebound.