Global equities staged their sharpest one-day rally in nearly two years and Brent crude shed more than 6% on Wednesday as the Iran-Israel ceasefire took effect at midnight GMT, capping six weeks of regional warfare that had whipsawed energy markets and weighed on growth forecasts on three continents.

By the open in New York, S&P 500 futures were pointing to a gain of roughly 2.4%, with the Nasdaq 100 tracking 3.1% higher on the back of a rebound in semiconductors and megacap tech. European bourses had already led the move overnight: the Stoxx Europe 600 closed up 2.7%, Germany’s DAX rose 3.1% and London’s FTSE 100 added 1.9%. In Asia, the Nikkei 225 jumped 3.4% to its highest close since late February, while the Hang Seng finished 2.8% higher.

Crude oil, which had peaked above $125 a barrel in late March before easing on OPEC+’s emergency production hike, extended its retreat. Brent for June delivery fell as low as $97.40 in London trading before steadying near $98.20, down $6.60 on the day. West Texas Intermediate slipped under $94. Traders said the move reflected both relief over the truce and growing confidence that the additional 1.5 million barrels per day approved at the Vienna meeting on April 1 would arrive without interruption through the Strait of Hormuz.

“The risk premium is bleeding out of this market in real time,” said John Reilly, head of commodities strategy at Citi in London. “We had been pricing maybe a 30% chance the ceasefire fell apart in the first 48 hours. Now the question is whether Brent settles in the low-90s by month-end. We think it does, assuming UN observers actually get on the ground in Hormuz as promised.”

The ceasefire, announced from Islamabad on April 12 after weeks of mediation by Pakistan, Saudi Arabia and Egypt, formally took effect at 00:00 GMT. The final hours before the deadline brought one last Iranian missile volley, which Israeli and U.S. air defenses intercepted over the eastern Mediterranean, and a single Israeli strike on a centrifuge facility near Natanz. Markets had braced for worse: futures dipped briefly during the Asian session before reversing as it became clear no further exchanges had occurred past midnight.

Shipping and insurance markets reacted almost as sharply as crude. The Baltic Dirty Tanker Index, which had nearly doubled since early March, fell 11% in a single session. War-risk insurance premiums on tankers transiting the Strait of Hormuz, which had ballooned to as much as 2.5% of hull value, dropped to 0.9% in early indications from Lloyd’s syndicates, according to brokers at Howden. Container rates on the Asia-Europe route eased about 4%.

“You’re seeing the supply-chain piece unwind faster than the equity piece,” said Maria Chen, a senior shipping analyst at Clarksons Research. “Owners who diverted around the Cape of Good Hope are already signaling a return to Red Sea routing within 10 days, conditional on the Houthi posture. That’s the wild card.”

Houthi forces in Yemen, who escalated attacks on commercial shipping in the Bab el-Mandeb during the war, issued an ambiguous statement Tuesday night saying they would “evaluate the conduct” of the truce before adjusting their own operations. A single launch from Houthi-controlled territory shortly after the ceasefire took effect was condemned by both Iranian and Saudi officials and intercepted without damage, according to U.S. Central Command.

Currency markets reflected the same risk-on tone. The dollar index slipped 0.7%, with the yen and Swiss franc giving back haven gains accumulated since March. The euro rose 0.9% against the dollar to $1.094. Gold, which had touched a record above $2,520 an ounce on April 9, fell 2.1% to $2,415. The 10-year U.S. Treasury yield rose 8 basis points to 4.27% as investors moved out of safe assets.

Bank and airline stocks led sector moves in Europe. Lufthansa rose 6.4% and Air France-KLM 5.9% on expectations that Middle East airspace closures, which had forced costly reroutings since early March, would lift within days. Saudi Aramco gained 1.8% in Riyadh, paring earlier losses; analysts at Morgan Stanley noted that while lower crude prices weigh on the company, the removal of strike risk on Gulf infrastructure was the dominant factor.

Not every corner of the market joined the rally. Defense contractors, which had outperformed sharply since early March, gave back ground. Shares of Lockheed Martin fell 3.6% in premarket trading, Northrop Grumman 4.1%, and BAE Systems closed down 5.2% in London. Energy producers were mixed: integrated majors slipped on the crude move, while refiners gained on improving crack spreads.

Several strategists cautioned against assuming a clean unwind of the war premium. Layla Hassan, a Beirut-based regional analyst at the consultancy Eurasia Levant, said the prisoner exchange expected in Doha later this week and the deployment timeline for UN monitors would matter more than the headlines. “If the choreography slips in the first two weeks, the market will reprice quickly,” she said. “Right now investors are giving the parties the benefit of the doubt. That benefit is not unlimited.”

Treasury Secretary Janet Reeves, speaking on CNBC shortly after the New York open, said the administration was watching energy markets closely and would coordinate with the Strategic Petroleum Reserve team on any further releases “only as conditions warrant.” She declined to comment on whether the recent rally validated the White House’s handling of the conflict, saying that question was “for the political people, not Treasury.”

Earnings season opens in earnest next week, with JPMorgan Chase, UnitedHealth and Netflix among the first major U.S. companies to report. Analysts at Goldman Sachs said in a Wednesday morning note that they expected guidance to be cautious despite the ceasefire, given the lingering effects of higher fuel costs on transportation and logistics firms through the first quarter. The bank reiterated its year-end S&P 500 target of 6,400, calling the day’s rally “warranted but unlikely to extend in a straight line.”

Trading desks across Wall Street said volumes were running roughly 40% above the 20-day average by 9 a.m. Eastern. Officials at the New York Stock Exchange said opening procedures had functioned normally despite the volume surge, and that no circuit-breaker thresholds were close to being triggered.