Stocks surged, with the S&P 500 rising 1.7% and the Nasdaq 100 adding 3.1%, as the prospect of a US-Iran deal to reopen the Strait of Hormuz sparked optimism. The Dow Jones Industrial Average also hit all-time highs. Cryptocurrencies, including Bitcoin which topped $66,000, also saw a rally as investors moved into riskier assets.
Oil prices eased, with US crude settling below $81 per barrel, as the potential end to the conflict and the reopening of the crucial shipping lane reduced concerns about supply disruptions and inflation. This decline in oil prices also led to a significant decrease in bets on Federal Reserve rate hikes.
The overall market reaction indicated a strong global enthusiasm for the agreement, which was signed sooner than expected. This timing was particularly supportive as major central bank policy meetings had recently concluded, removing a key source of uncertainty for investors. However, some analysts noted that while sentiment was positive, the practicalities of resuming full shipping operations and normalizing logistics would take time.
