Oil sinks and stocks rally on peace hopes, Samsung tops $1 trillion

SEOUL

(FILES) A man walks past an advertisement for the Samsung Galaxy S25 series smartphones at a Samsung store in Seoul on July 8, 2025.(AFP)

Oil prices extended losses and stocks rallied Wednesday on fresh hopes for an end to the Iran war and the reopening of the Strait of Hormuz, while Samsung blasted past the $1 trillion valuation mark as the AI tech boom continued apace.

Investors welcomed Donald Trump's decision to pause efforts to help stranded ships through the crucial waterway, which drew Iranian attacks, threatening an already fragile ceasefire.

The U.S. president, who had been quoted as warning that Iran would be "blown off the face of the Earth" if it attacked U.S. ships, appeared to take a more conciliatory tone Tuesday.

"Project Freedom (The Movement of Ships through the Strait of Hormuz) will be paused for a short period of time to see whether or not the Agreement can be finalized and signed," he wrote in a social media post.

He cited "the fact that Great Progress has been made toward a Complete and Final Agreement with Representatives of Iran" for the decision, adding that it came at the request of mediator Pakistan.

The U.S. blockade of Iranian ports remained, however.

The announcement came hours after Secretary of State Marco Rubio said the offensive side of the U.S. campaign, called "Operation Epic Fury", had concluded.

"The operation is over — Epic Fury — as the president notified Congress. We're done with that stage of it," Rubio told reporters at the White House.

Pentagon chief Pete Hegseth had said the United States was "not looking for a fight", but warned attacks would face "overwhelming and devastating" force.

Oil prices sank around four percent Tuesday, and on Wednesday they continued to fall, with West Texas Intermediate briefly dipping below $100 a barrel.

The cheaper oil prices provided support to equities, with investors taking their cue from another record day for the S&P 500 and Nasdaq, fuelled again by tech firms.

Hong Kong, Shanghai, Sydney, Wellington, Taipei, Manila and Jakarta were all up.

"Investors found some reassurance in comments from President Donald Trump... despite ongoing disruption to shipping routes," said Fiona Cincotta, a senior market analyst at City Index.

"Investors are also finding some reassurance in the fact that the diplomatic push to resolve the conflict continues."

She added that strong U.S. earnings were also boosting risk appetite as they had largely been in line with forecasts.

However, she added: "Sentiment remains vulnerable. Even U.S. entities could face serious headwinds should the Strait of Hormuz remain closed for an extended period."

The standout performer was Seoul's Kospi index, which piled on more than five percent to pass 7,000 points for the first time.

That came on the back of an eye-watering surge by Samsung, which rocketed as much as 12 percent to hit a market capitalisation of more than $1 trillion thanks to huge demand for its AI chips.

That makes it just the second Asia firm after Taiwan's TSMC to reach the figure.

Rical SK hynix soared around 10 percent.

Samsung's shares have risen around 300 percent over the past year as the AI boom boosts South Korean growth.