Global markets experienced a significant rally last week as hopes for de-escalation in the Middle East rose, following Iran's temporary announcement of opening the Strait of Hormuz. This led to a sharp drop in oil prices and a surge in risk assets, with U.S. stocks reaching new highs. However, Iran's subsequent signals of maintaining military control and ongoing U.S. sanctions have reignited concerns over potential volatility. The upcoming week will focus on U.S.-Iran negotiations, with President Trump indicating possible progress over the weekend. He warned that failure to reach an agreement by Wednesday could end the ceasefire and increase conflict risks. Meanwhile, the Federal Reserve's policy signals will also be crucial, as falling energy prices have raised expectations for a rate cut this year to 60%. Fed chair nominee Kevin Warsh's Senate hearing next week will be closely watched for his policy stance, particularly regarding interest rates.