TOKYO, April 8 (Reuters) - Japan's Nikkei index posted its biggest gain in a year and bonds and the yen rose on Wednesday as a ceasefire agreement between the United States and Iran sent crude oil prices tumbling and eased concerns about an economic slowdown.

The Nikkei index rose 5.39 percent to 56,308.42 points, marking its fourth consecutive day of gains and reaching its highest closing level since March 2. The yield on Japanese government bonds fell four basis points to 2.365 percent after hitting a 27-year high on Tuesday.

More than five weeks after the United States and Israel began their air strikes against Iran, US President Donald Trump said he had agreed to a two-week cessation of hostilities ahead of a deadline he had set for Tehran to reopen the Strait of Hormuz.

Iran’s Supreme National Security Council described the agreement as a victory, saying that Trump had accepted Iran’s terms for a truce.

Shingo Ide, senior equity analyst at the NLI Research Institute, said that Pakistan's role in mediating between the United States and Iran lends the agreement a degree of credibility, contributing to market optimism.

He added, "Hopes are growing that if things continue this way after these two weeks, it could practically mean a real ceasefire."

U.S. crude futures plunged more than 19 percent to below $100 a barrel, and the yen surged to its highest level in more than two weeks at 158.05 to the dollar. Japan's economy is particularly vulnerable to the effects of oil price volatility due to its heavy reliance on energy imports.

Wednesday's rise in the Nikkei index is the largest since April 10, 2025, when the index jumped nine percent after Trump backed down on some elements of a massive tariff plan dubbed "Liberation Day."

Companies linked to the energy-intensive semiconductor and artificial intelligence sectors saw the largest gains. Among the Topix sub-sectors, mining and shipping experienced the biggest declines.

Chipmaker Kioxia Holdings posted the biggest percentage gain on the Nikkei index with its stock rising 18.6 percent, followed by Furukawa Electric at 17.6 percent and Advantest at 13.6 percent.

Inpex Oil Exploration shares fell 6.2 percent, topping the list of losing stocks, followed by Idemitsu Kosan shares, which fell 5.9 percent, and Kawasaki Kisen Shipping shares, which dropped 3.9 percent.

"It is not yet clear whether crude oil prices and supplies will return to pre-war levels," said Maki Sawada, equity analyst at Nomura Securities. "Because of this uncertainty, I think there is a strong possibility of a pullback after this strong rally."