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Spot gold prices surged more than 2.5% on Wednesday to reach an intraday high of $4,179.5, their highest level in a month, after reports emerged of a potential deal between the U.S., Iran and Oman to reopen the Strait of Hormuz.
The rally also marked gold's strongest daily performance since June 11, when prices climbed more than 3.4% to surpass $4,200 per ounce.
The gains were largely driven by easing concerns over inflationary pressures stemming from elevated oil prices, as any agreement to secure shipping through the strategic waterway is seen as key to stabilizing energy flows from Gulf producers, which normally account for around one-fifth of global oil supply.
International benchmark Brent crude extended its decline, falling 0.5% to $79 per barrel, while U.S. benchmark WTI dropped 0.9% to $75 per barrel.
Across Asian markets, South Korea's Kospi closed up 3.8%, while Japan's Nikkei 225 gained 3.7%, with chipmakers and technology companies leading the advances. China's Shanghai Composite rose 1.5%, and Hong Kong's Hang Seng edged up 0.3%.
In Europe, the Euro Stoxx 50 gained 0.5%, Germany's DAX advanced 0.8%, France's CAC 40 rose 0.20%, and the UK's FTSE 100 added 0.4%.
Futures tied to all major U.S. indices traded higher, with Nasdaq futures leading the gains, up 0.3% after the index climbed 2.6% in Tuesday's session.
Among other precious metals, silver climbed nearly 4% to $61.9 per ounce, while platinum gained more than 2% to $1,780 and palladium rose more than 3% to $1,380 per ounce.
Bitcoin rose 1% to around $64,100, while Ethereum hovered around $1,860, up 0.7%.
U.S. President Donald Trump said Tuesday that Washington and Tehran were holding "very good discussions" after a full day of negotiations, raising expectations that a temporary agreement to restore commercial shipping through the Strait of Hormuz could be within reach.
According to U.S. news outlet Axios, the United States, Iran, and Oman are moving closer to an interim arrangement that would reopen the strategic waterway for an initial 60-day period while broader negotiations continue.
The proposed deal aims to restore safe passage through one of the world's busiest oil shipping routes after weeks of disruption triggered by renewed U.S.-Iran hostilities.
The report added that Iranian Foreign Minister Abbas Araghchi has approved the proposed framework, although it still requires final approval from Iran's leadership before an agreement can be announced.
Beyond developments in the Strait of Hormuz, investors are also turning their attention to key U.S. labor market data, with the ADP employment report for July expected to show private-sector job growth of about 75,000 ahead of Friday's closely watched nonfarm payrolls report.
The figures are expected to provide fresh clues on the strength of the U.S. economy and help shape expectations for the Federal Reserve's next interest-rate decision.
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