One stray missile or tweet could change it allpublished at 12:25 GMT
Faisal Islam
Economics editor
In the half hour after President Trump posted about the constructive conversations with Iran, there were remarkable changes in markets.
Broadly put, energy prices tumbled in expectation of a more normal supply of oil and gas. The Brent crude oil price fell 12% to below $100 (£75) a barrel.
Stock markets: Turned around on expectations of a pathway to end the war, with US markets predicted to open up 2-3%.
The markets for government debt, the bond markets, or for the UK the gilt markets, saw extraordinary falls in the effective interest rate.
These yields had spiked very high this morning in anticipation of a prolonged conflict with a permanent impact on supply, igniting a wave of inflation and an energy shock.
In the UK: The markets were pricing in a remarkable four rate rises this year at one point. Much of that reversed in anticipation equally remarkable half hour with the 10 year yield falling 0.4 percentage points to 4.78%.
To be clear, all these markets are still in worse shape versus where they were before the conflict.
Even if everything ended this week there are still scars to the supply of gas, for example, with the damage done to key facilities in Qatar.
Image source, ReutersCargo ships pictured near the Strait of Hormuz earlier this month
Strait of Hormuz: There is a significant continuing risk factor now from Iran’s demonstrated ability to control the flow of commercial shipping through the key shipping channel using relatively low tech methods.
There is, however, an opportunity for an off ramp, and avoidance of a rather wild escalation to, for example, nuclear power plants and desalination facilities.
This could all turn around with one stray missile, or stray tweet, but things have already moved on considerably from where we were even at 11:00 GMT.
