The S&P 500 and the Dow hit record highs, while Brent crude fell below $80: the market is awaiting a deal with Iran
The Dow is heading for its second consecutive record close / Photo: X / NYSE
The U.S. stock market is rallying: stocks have surged on the back of strong quarterly earnings reports from companies such as Palantir Technologies and Caterpillar, as well as falling oil prices amid hopes for a soon-to-be-reached agreement between the U.S. and Iran to reopen the Strait of Hormuz.
The S&P 500 broad-market index jumped 1.4%, reaching an intraday record high. The Dow Jones Industrial Average, a blue-chip index, gained 1.7% and is also trading at a high, after closing at a record high the previous day. The Nasdaq Composite, a technology sector index, rose 2%.
Oil prices plummeted by more than 5.3%: futures for the benchmark Brent crude were trading below $80 per barrel, while contracts for North American WTI were trading at $76 per barrel.
When to Expect the Transaction
U.S. Treasury Secretary Scott Bessent said Tuesday that an agreement with Iran, which would restore the free movement of ships through the Strait of Hormuz, could be signed in the near future—“today or tomorrow.”
At the same time, Bloomberg reported that Iran is considering allowing European countries to participate in the mine-clearing operation in the strait. Such a move could be part of a deal to normalize shipping traffic and also help resume peace talks with the U.S., unnamed diplomats told the agency. For shipping companies and insurers, this would serve as confirmation of safety from independent parties, Bloomberg notes.
What Analysts Are Saying
“Watching the stock market’s rapid rise over the past three sessions, one might think there are no problems in the world at all,” Thierry Wizman, global strategist for currencies and interest rates at Macquarie Group, told CNBC. “Even semiconductor manufacturers have rebounded from their sharp July decline, as some hyperscalers have managed to allay analysts’ concerns that investments in data centers are excessively squeezing cash flows. Furthermore, U.S. companies’ quarterly results have not been disappointing so far.”
“Markets are reacting to the likelihood that the reopening of the Strait of Hormuz will help normalize global oil supplies and ease pressure on energy prices in the short term,” said Tony Miano, an analyst at Wells Fargo Investment Institute, as quoted by Bloomberg. “Lower oil prices could also help mitigate inflationary risks.”
This article was AI-translated and verified by a human editor
