US stock markets experienced a mixed day as hopes of a potential US-Iran deal to reopen the Strait of Hormuz provided a late-session boost, helping stocks recover from earlier losses. The Dow Jones Industrial Average initially fell by 162 points (0.3%) to 51,350, the S&P 500 slipped 2 points to 7,704, and the Nasdaq added 3 points to 26,939. However, later reports indicated a more substantial rebound with the S&P 500 rising 1%, the Dow gaining 383 points, and the Nasdaq advancing 1.2%, driven by technology stocks.
The improvement in market sentiment was largely attributed to Reuters reports suggesting that US and Iranian negotiators were exploring a phased agreement to reopen the Strait of Hormuz and lift economic sanctions on Iran. This prospect led to a decline in oil prices, with Brent crude falling $1.19 to $78.36 a barrel and US benchmark crude dropping $1.56 to $74.45 a barrel. While these prices remain above pre-war levels, they are significantly lower than the $100-plus levels seen weeks prior. The agreement reportedly allows Iran to resume oil exports in exchange for diluting its highly enriched uranium stockpile.
Despite the positive turn in oil prices, rising Treasury yields continued to weigh on overall market sentiment, with the 30-year yield reaching its highest level since 2004. Analysts like Kathleen Brooks, research director at XTB, noted a lack of clear market direction, while Chris Beauchamp of IG highlighted that the continued surge in oil prices, prior to the deal hopes, suggested markets were pricing in tighter supply. Corporate news also influenced trading, with GoDaddy Inc. shares jumping on a potential takeover offer, Everpure shares surging on strong fiscal 2028 revenue forecasts of $7 billion to $7.3 billion, and Intel surging 8.7% after President Trump's announcement. Conversely, Kinross Gold Corporation, Acadia Pharmaceuticals, MGM Resorts International, and Oracle Corp. saw declines due to various company-specific issues, including production guidance cuts, mixed clinical trial results, withdrawn takeover proposals, and potential delays in data center projects.
