Asian stock markets posted strong gains on Friday while oil prices fell after US President Donald Trump said progress had been made in efforts to end the Iran war, boosting investor confidence across global markets.
US stock futures also moved slightly higher following sharp gains on Wall Street.
South Korea's Kospi index surged 7.8 percent to 8,370.82, recovering much of the losses linked to recent sell-offs in artificial intelligence-related stocks. The benchmark index has nearly doubled over the past six months, though it remains below its record closing high reached on June 2.
Shares of Samsung Electronics jumped 11.2 percent, while chipmaker SK Hynix gained 7.2 percent.
Japan's Nikkei 225 advanced 3.5 percent to 66,442.95, led by technology stocks. SoftBank Group rose 2 percent and semiconductor equipment manufacturer Tokyo Electron soared 10.3 percent.
Hong Kong's Hang Seng index climbed 1.8 percent to 24,689.32, while China's Shanghai Composite gained 1.6 percent to 4,050.51.
Australia's S&P/ASX 200 rose 1.9 percent to 8,798.10. Taiwan's Taiex added 2.6 percent and India's Sensex increased 1.2 percent.
Investor sentiment improved after Trump said on Thursday that he had cancelled planned military strikes against Iran and claimed the United States had reached a significant understanding to end the conflict. He also suggested that an extension of the fragile ceasefire between the two sides could be agreed within days, although he provided few details.
Markets had come under pressure earlier this week as tensions between Washington and Tehran intensified. Rising oil prices have fueled inflation concerns worldwide, particularly as the Strait of Hormuz, a crucial route for global oil and gas shipments, remained largely closed.
Analysts at ING said there appeared to be more encouraging signs surrounding a possible agreement this time, although they cautioned that any ceasefire extension remained uncertain and could still prove fragile.
Oil prices retreated as hopes for a diplomatic breakthrough increased. Brent crude, the international benchmark, fell 1.7 percent to $88.87 per barrel, while US benchmark crude dropped 1.6 percent to $86.33 per barrel. Both remained significantly above pre-war levels of around $70 a barrel.
On Thursday, Wall Street recorded broad-based gains. The S&P 500 rose 1.8 percent to 7,394.30, the Dow Jones Industrial Average climbed 1.9 percent to 50,848.75, and the Nasdaq Composite gained 2.5 percent to 25,809.66.
Technology and AI-related stocks have experienced heightened volatility in recent days amid concerns that rapid share price increases and heavy investment spending could signal a market bubble.
Marvell Technology jumped 11.1 percent, while Oracle fell 8.5 percent despite reporting stronger-than-expected quarterly earnings, as investors worried about its growing spending commitments.
Investors were also watching the highly anticipated Wall Street debut of SpaceX, Elon Musk's rocket company, which is expected to become the largest initial public offering on record with plans to raise about $75 billion.
In currency trading, the US dollar strengthened to 160.22 Japanese yen from 159.93 yen, while the euro slipped slightly to $1.1574 from $1.1578.