The US-Iran ceasefire reached at the 11th hour, allowing Donald Trump to pull back from the threat to wipe out "a whole civilization" has sparked a relief rally in the world equities, including the US stock markets.

Wall Street was poised for a gap-up start on Wednesday, April 8, as US stock futures traded 2.5-3.5% higher around 5.30 am GMT. The tech-heavy Nasdaq's E-mini futures were up 3.5%, S&P 500 futures rose 2.7%, and Dow Jones E-minis were up 2.5%.

The US stock market had ended mixed on Tuesday with signs of progress in the diplomatic efforts for peaceful settlement of the ongoing war in ?the Middle East.

The two-week ceasefire reached at the last minute cheered investors, as it sent crude oil prices lower amid hopes that the Strait of Hormuz could reopen for global energy supplies. The critical waterway — through which about 20% of global oil needs flow — has been effectively shut since the onset of the war on February 28.

US President Trump said he agreed “to suspend the bombing and attack of Iran for a period of two weeks” as long as Iran agrees to “the COMPLETE, IMMEDIATE, and SAFE OPENING of the Strait of Hormuz.” His announcement represented a sharp change in rhetoric from an earlier warning that “a whole civilization will die tonight, never to be brought back again” if Iran didn’t give in.

Iranian Foreign Minister Abbas Araghchi said in a statement that “for a period of two weeks, safe passage through the Strait of Hormuz will be possible via coordination” with Iran’s military and that if attacks on its territory are halted, “our Powerful Armed Forces will cease their defensive operations.”

Meanwhile, US Vice President JD Vance on Wednesday welcomed a "fragile truce" with Iran, urging Tehran to negotiate in "good faith" to reach a long-term deal and warning US President Donald Trump was "not one to mess around."

That said, the ceasefire has brought relief to investors after weeks of conflicting signals from Trump and Iran that had dragged the conflict into a second month.