Asian Stock Markets Retrace After Trump’s Ceasefire-linked Relief Rally, Hang Seng Plummets 2%

• Asian equity markets take a pause after a relief rally, as oil prices rebound.
• Iran confirms no engagement in ceasefire talks and wants its conditions to be fulfilled before doing so.
• US President Trump warns of escalation in military activities against Iran if it refuses to accept a ceasefire.

Asian stock markets face profit-booking on Thursday after rallying in the last two-three trading days. Equity markets across the largest continent have corrected as the oil price has rebounded, with Iran’s refusal to United States (US) President Donald Trump’s ceasefire plan reviving uncertainty in the Middle East.

As of writing, Nikkei 225 is down 0.72% to near 53,365, Shanghai trades almost 1% lower to near 3,900, Hang Seng dives 2% to near 24,840. Meanwhile, Indian stock markets are closed on Thursday amid Ram Navami celebrations.

WTI oil price extends Wednesday’s gains over 1% to near $91.50 during the day. Higher oil prices carry a negative relation with equities, given that rising energy prices act as key drag on corporate earnings.

Iran's Foreign Minister Abbas Araghchi has stated that the government has not engaged in ceasefire talks with the US and have no plans of any negotiations, according to an Iranian state TV, which also reported a statement from a senior official that Tehran would end the war “when it decides to do so and when its own conditions are met”, and until then it would continue attacks across the region.

According to a report from the Wall Street Journal (WSJ), Tehran key conditions include guarantees that the war would not restart and an end to Israeli strikes on Hezbollah, no interference in Iran’s missile program, and recognition of Iran’s authority at the Strait of Hormuz.

Meanwhile, White House press secretary Karoline Leavitt has stated that US President Trump has warned that Washington’s military will escalate attacks on Iran if it doesn’t agree to a ceasefire.