Iran Ceasefire Rally: ASX Stocks to Sell Now and Which Are Still Worth Holding

The ASX 200 surged more than 4% last week after the United States and Iran agreed to a two-week ceasefire on 8 April, mediated by Pakistan. It was the local market’s strongest weekly performance since October 2022, and it created a sharp divide between the stocks that soared and the stocks that crashed.

But here is the catch. Over the weekend, US Vice President JD Vance left Islamabad after 21 hours of negotiations ended without a deal. Iran refused to commit to abandoning its nuclear program, and both sides blamed the other for the breakdown. The fate of the fragile ceasefire is now uncertain. Meanwhile, the Strait of Hormuz remains largely restricted. Only around 10 vessels transited the waterway on Saturday, compared to more than 100 ships daily before the conflict. Brent crude closed the week at around US$95 a barrel, still well above pre-war levels of US$73.
The rally last week was real. The risk going into this week is even more real. Here is what to do with your positions.

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Why This Rally Deserves More Caution Than Celebration

The ceasefire is a two-week pause, not a lasting resolution, and it is already under strain. Analysts describe a deep trust deficit on both sides, with Iran insisting on control of the Strait of Hormuz and Washington refusing to back down on the nuclear issue.

Oil prices bounced sharply back towards US$99 a barrel within 24 hours of the ceasefire before settling around US$95 by Friday close. With talks now broken down, expect energy markets to be volatile again at Monday’s open. The market priced in a best-case outcome that has not arrived.

The ASX Stocks to Sell (or at Least Trim)

Woodside (ASX: WDS) and Santos (ASX: STO) are the clearest candidates to reduce. Woodside shares plummeted more than 10% on the day of the ceasefire announcement as oil’s war premium collapsed, while Santos also fell sharply. Woodside had gained more than 50% this year, riding Brent crude above US$118 a barrel at its peak. With the ceasefire now stalled and oil still volatile, the risk-to-reward on energy stocks is unfavourable. If a deal eventually holds, oil falls further. If it breaks down entirely, RBA inflation risk returns. Neither outcome is particularly clean for energy shareholders right now.
Any rate-sensitive stocks that rallied purely on sentiment rather than business fundamentals are also worth reviewing. The rebound in bond yields last week already hit those positions hard.

The ASX Stocks Still Worth Holding

Gold stocks NST, BGL, and EVN remain the standout holdings. Bellevue Gold (ASX: BGL) surged nearly 19% last Wednesday, powered by two tailwinds at once: gold prices rallied strongly on the day, and the company released a record quarterly cash flow result of A$158 million for the March quarter, its strongest result on record. Gold closed the week at US$4,751 an ounce, holding firm even during the ceasefire relief rally. That resilience is the signal. With talks now collapsed, safe-haven demand for gold is only likely to strengthen this week.

Tech stocks like WiseTech Global (ASX: WTC) and Life360 (ASX: 360) also have a genuine fundamental case. Bond yields fell sharply on ceasefire news, lifting high-growth tech stocks as the present value of future earnings rose. WiseTech gained 10.7%, and Life360 gained nearly 12% on the day. The thesis here depends on whether diplomacy restarts quickly. Watch this space closely.

The Investor’s Takeaway

Sell or trim what rallied purely because oil spiked. Hold what rallied because lower rates and lower inflation genuinely improve the business case.
The single most important data point to watch this week is not what politicians say in press conferences. It is tanker traffic through the Strait of Hormuz. If ship movements stay restricted and talks do not resume, markets will reprice quickly, and the ceasefire rally will look like a dead cat bounce.