New York (AFP) - Oil prices tumbled Monday as the United States and Iran paused tit-for-tat strikes, helping most stock markets climb at the start of a week packed with corporate earnings and central bank decisions.

International benchmark Brent fell more than eight percent to $88.36 per barrel as the US and Iran held their fire, handing Gulf shipping and the oil industry a respite.

Donald Trump was “giving talks some space”, said the US president’s UN envoy.

The US and Iran resumed hostilities earlier this month, breaking a fragile truce, after the Islamic republic attacked ships passing through Omani waters in the Strait of Hormuz, sparking a pattern of escalation.

Crude prices soared on the flare-up, with Brent breaking back above $100 a barrel last week for the first time since May.

“Although the situation in the Middle East has calmed, it has not been resolved, and it could make a decline below $85 per barrel tricky at this stage,” said Kathleen Brooks, research director at XTB trading group.

David Morrison at Trade Nation said that “investors are hoping that this could be a precursor to a resumption in peace talks.”

The calmer situation eased worries about a resurgence in inflation and a fresh round of interest rate hikes, helping lift equity markets Monday.

But early gains on Wall Street failed to hold, with only the Dow finishing in positive territory, with tech stocks continuing to drag down the Nasdaq Composite.

“When a calming of Middle Eastern hostilities fails to provoke a major up day in stocks, you know there is more trouble ahead,” said Chris Beauchamp, chief market analyst at online trading and investing platform IG.

“Earlier optimism around a pause in fighting did not last once the US session began, and investors took the earlier gains as a chance to cut back exposure yet further in battered tech stocks,” he added, pointing to a hefty drop in AI processor heavyweight Nvidia.

US chip stocks were also dented by a report of a technological breakthrough by Chinese company Shanghai Yuliangsheng that could accelerate the growth of China’s computer chip industry.

In Europe, Frankfurt jumped one percent, while London and Paris also closed higher.

The US Federal Reserve is expected to stand pat on interest rates on Wednesday, with the Bank of England set to follow suit Thursday.

In Asian stock market trading, Tokyo, Seoul, Hong Kong and Shanghai all advanced.

Traders are awaiting also earnings from South Korea’s SK hynix and Samsung and Japan’s Kioxia this week, while US titans Microsoft, Meta, Apple and Amazon are due to update, with focus on their outlooks and spending plans.

The share price of China’s leading memory chipmaker, CXMT, rocketed more than 500 percent on its market debut in Shanghai to become the mainland’s most valuable company, before later paring the gains to end up 465 percent.

The breathtaking surge came after the Anhui-based company had raised $9.8 billion in a blockbuster initial public offering, Bloomberg News reported, making it China’s biggest mainland tech share sale.

- Key figures around 2010 GMT -

Brent North Sea Crude: DOWN 8.7 percent at $88.36 per barrel

West Texas Intermediate: DOWN 7.5 percent at $82.61 per barrel

New York - Dow: UP 0.5 percent at 52,210.23 (close)

New York - S&P 500: FLAT at 7,413.21 (close)

New York - Nasdaq Composite: DOWN 0.2 percent at 24,932.08 (close)

London - FTSE 100: UP 0.4 percent at 10,781.75 (close)

Paris - CAC 40: UP 0.4 percent at 8,406.06 (close)

Frankfurt - DAX: UP 1.0 percent at 25,361.03 (close)

Tokyo - Nikkei 225: UP 0.5 percent at 64,931.19 (close)

Hong Kong - Hang Seng Index: UP 1.0 percent at 25,207.18 (close)

Shanghai - Composite: UP 1.2 percent at 3,858.24 (close)

Euro/dollar: UP at $1.1371 from $1.1370 on Friday

Pound/dollar: DOWN at $1.3293 from $1.3325

Euro/pound: UP at 85.54 pence from 85.33 pence

Dollar/yen: DOWN at 163.72 yen from 163.83