Is the war in Gaza finally over? Here are some key unanswered questions about what comes next

A US-brokered peace plan for Gaza has initiated with a prisoner exchange and a declared cessation of hostilities by President Trump, yet significant uncertainties persist regarding its full implementation. Only the first phase is complete, with critical issues such as Hamas's disarmament, future governance of Gaza, and Israel's complete withdrawal remaining unresolved and contentious. While phase two talks have commenced, Israeli Prime Minister Netanyahu maintains the military campaign is ongoing, and the long-term viability of the plan, including the establishment of a Palestinian state and the deployment of an international stabilization force, faces considerable political and logistical hurdles, signaling continued regional instability despite initial diplomatic progress.

Analysis

The US-brokered peace plan for Gaza has initiated with the release of 20 Israeli hostages and nearly 2,000 Palestinian prisoners, marking the completion of its first phase. However, significant uncertainty persists regarding the conflict's resolution, as President Trump's declaration of "the war is over" directly contradicts Israeli Prime Minister Netanyahu's statement that the "military campaign is not over." This divergence highlights fundamental disagreements on the ground.

Critical issues remain unresolved, including Hamas's disarmament, the future governance of Gaza, and the conditions for Israel's complete withdrawal from the enclave. While phase two talks have reportedly begun in Sharm el-Sheikh, Hamas has indicated it would reject an international body ruling Gaza, and Israel's withdrawal is conditional on Hamas fulfilling its obligations, creating a complex negotiation landscape.

The broader geopolitical context, including the contentious issue of Palestinian statehood and the mandate for an International Stabilization Force, further complicates the outlook. The market signals reflect this ambiguity, with a "mildly negative" sentiment score of -0.35 and an "uncertain" tone, indicating that despite initial diplomatic progress, significant regional instability risks persist, warranting close investor scrutiny.

Key Decisions for Investors

• Monitor geopolitical developments closely, particularly progress on Hamas disarmament and Gaza governance, as these are critical for sustained regional stability
• Assess potential impacts on regional assets and sectors sensitive to geopolitical risk, given the "mildly negative" sentiment and "uncertain" tone
• Evaluate the long-term viability of the peace plan, considering the significant political hurdles and conflicting objectives among key stakeholders