Global Markets Tumble Amid US-Iran Diplomatic Hopes and AI Fears

Oil prices continued to decline on Tuesday after plummeting on Monday as hopes of renewed diplomatic efforts between the United States and Iran eased concerns over disruptions to crude supplies through the Strait of Hormuz. The slump came as global markets were also rattled by a sharp sell-off in technology stocks, with Asian chipmakers suffering heavy losses amid fresh concerns over the future of the artificial intelligence boom.

The two sides had been engaged in retaliatory attacks sparked by a breakdown in diplomacy over Tehran's blockade of the Strait of Hormuz. However, US President Donald Trump expressed hope that renewed diplomacy could bring an end to the war that began in late February. 'I have a lot of patience... We'll see what happens,' he said aboard Air Force One.

The optimism sent both main crude benchmarks sharply lower, with international benchmark Brent losing more than eight percent on Monday and WTI more than seven percent. Both were down over one percent in Asian trade, with Brent crude oil trading at $88.36 per barrel on Tuesday morning.

Tech stocks took a battering as South Korea's Kospi collapsed 10 percent, with semiconductor firms leading the region-wide rout. Seoul-listed SK hynix and Samsung lost around 13 percent, dragging the Kospi index down 10.2 percent. Tokyo's Nikkei tanked over four percent, while Taiwan's market was off more than four percent.