Emerging-market stocks hit record high on US-Iran peace deal optimism
Updated
Updated · Bloomberg · May 6
Emerging-market stocks hit record high on US-Iran peace deal optimism
14 articles · Updated · Bloomberg · May 6
MSCI’s emerging-market equities gauge rose 3.2% on Wednesday, topping 1,700 points for the first time, while emerging-market currencies also advanced.
The rally was also driven by gains in Asian technology shares as investors increased risk appetite on hopes Washington and Tehran are moving closer to a deal.
The index has rebounded 22% since its 2026 low on 31 March, after early weeks of the Iran conflict had lifted oil prices and the dollar.
As a record market rally evaporates overnight, what does this mean for the future of global trade?
The Strait of Hormuz is blocked again. Can the global economy survive without 20% of its oil?
With peace talks collapsing, is China's support for Iran the next flashpoint in the escalating conflict?
US-Iran Peace Deal Nears as Emerging Markets Soar 25% and Oil Prices Drop
Overview
In early May 2026, emerging market stocks surged to record highs, driven by strong corporate earnings in the AI sector and growing optimism from progress toward a US-Iran peace deal. The announcement of a pause in US naval operations in the Strait of Hormuz and reports of a near-final memorandum led to a sharp 10% drop in Brent crude oil prices, easing fears of Middle East supply disruptions. This decline boosted energy-importing emerging economies and fueled a risk-on market mood. However, the Strait remains largely closed, and full reopening is expected to take months, prolonging inflationary pressures. Meanwhile, AI demand continues to outpace supply, supporting sustained emerging market equity gains despite ongoing geopolitical and supply chain risks.