Yesterday, equity indices closed higher. The S&P 500 rose by 0.62%, while the Nasdaq 100 jumped by 0.83%. The Dow Jones Industrial Average added 0.58%.

Asian equity indices also strengthened, posting their first weekly gain since the start of the war in the Middle East, as investors view the market with cautious optimism ahead of US–Iran talks scheduled for this weekend. Oil is set to record its largest weekly decline in nine months.

Against the backdrop of easing regional tensions, Asian markets showed resilience, bouncing up in line with positive sentiment on Wall Street. Investors closely tracking geopolitical developments see the upcoming US–Iran negotiations as a potential de-escalation catalyst. Any constructive signals could spur further gains in risk assets, including equities.

The cautious lift in Asian indices suggests investors are probing for opportunities amid ongoing uncertainty. The MSCI Asia Pacific index rose by 0.8% after US President Donald Trump expressed optimism about a deal with Iran, despite threats to Tehran over transit fees for passage through the Strait of Hormuz. Technology stocks, seen as less exposed to the conflict with Iran, outperformed.

Traders are monitoring the fragile truce and the Saturday talks in Islamabad between the US and Iran for clues on the market's next move. Although Israel's agreement to enter talks with Lebanon improved sentiment, the continued closure of the Strait of Hormuz — the key transit artery for oil flows — keeps investors on edge, and recent weeks have seen sharp swings at the start of Monday trading.

It was reported that Israeli Prime Minister Benjamin Netanyahu agreed to enter talks with Lebanon, while Trump said the Israeli leader would act with restraint toward the war-torn country, offering some hope for de-escalation.

The US and Iran have largely paused strikes after fighting continued in the region on Wednesday despite the ceasefire announcement on Tuesday evening. On Thursday evening, Kuwait's Foreign Ministry reported that new drone attacks carried out by Iran and its proxies targeting several important facilities in the country.

Elsewhere, gold eased slightly, trading around $4,760 per ounce. Treasuries ended a four-day rally as investors awaited US inflation data due today. Economists surveyed expect the consumer price index to rise 0.9% month-on-month, the largest monthly increase since 2022.

As for the S&P 500 technical picture, the main task for buyers today is to overcome the nearest resistance level of $6,819. That would help the index gain upside momentum and could pave the way for a surge to $6,837. Equally a priority for bulls will be control above $6,854, which would strengthen buyers' positions. In the event of a downside move amid reduced risk appetite, buyers must assert themselves around $6,801. A break below that level would quickly push the instrument back to $6,784 and could open the way to $6,769.