Stocks Up on Report That Trump May End Iran War Soon
The stock market is climbing on news that the war in Iran may come to an end soon after a report emerged from the Wall Street Journal.
Quick overview
- President Trump may soon end the war in Iran, boosting U.S. stock futures.
- The Dow, Nasdaq, and S&P 500 indices all rose by 0.8% following the news.
- Despite higher oil prices, investors are optimistic about the stock market's future.
- The closure of the Strait of Hormuz continues to impact global oil supplies and prices.
President Donald Trump may stop the fighting in Iran even without the Strait of Hormuz open, according to a report this week that pushed U.S. stock futures higher.
On Tuesday, the U.S. stock market climbed on news that Trump may be bringing an end to the war in Iran soon. The Dow jumped 0.8%, and the Nasdaq and S&P 500 indices increased by the same amount.
An end to the war could mean lower oil and gas prices soon, even if the Strait of Hormuz has not reopened. At the very least, oil production facilities and oil fields will become safer. A report from the Wall Street Journal said that Trump has been telling his aides his is looking for closure in Iran very soon.
Stock Futures Expected to Climb Even with Higher Crude Oil Prices
Oil prices remain elevated despite the potentially good news, with West Texas Intermediate futures increasing by 1.5%. Brent crude futures rose 2.4% and have now reached $115 per barrel. The higher oil prices have not been enough to dissuade traders on the stock market from getting their hopes up.
In premarket trading, tech futures climbed across much of the market, with Nvidia (NVDA) gaining 0.8% and moving in step with the stock indices. Microsoft (MSFT), which has been under pressure since the war began (along with many other tech stocks), rose 1.65% in premarket trading. Advanced Micro Devices (AMD), coming off Monday’s sharp losses rose 1.14% Tuesday morning.
With tech stocks on the rise, it appears that investors are growing bolder and more confident in where the market is headed. Tech stocks have declined for most of the days of the Iran war since February 28th, leading to long-tail bearish trends that have sunk investor sentiment.
The sharp swing from yesterday’s downturn indicates market volatility. Investors should be careful about expecting the current upswing to remain in place and should anticipate quick movements until actual peace is established in the Middle East.
The Strait of Hormuz remains closed, and with that closure, about 20% of the world’s oil supplies have been rerouted or stopped. As long as that waterway is shut down, oil prices will be elevated and stock futures will have a hard time regaining lost ground due to strong inflation worries.
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