Wall Street Surges 1,300 Points as Oil Plunges on US–Iran Truce

Wall Street staged a powerful rally after a surprise geopolitical breakthrough, with investors piling into risk assets following a two-week ceasefire agreement between the United States and Iran announced by Donald Trump.

The agreement, revealed just hours before a deadline tied to the reopening of the Strait of Hormuz, came after Washington received a 10-point proposal from Tehran that was deemed a credible basis for negotiation. The development triggered a sharp shift in market sentiment, sparking a broad-based buying spree across equities.

The Dow Jones Industrial Average surged more than 1,300 points, closing up 2.9%, while the Nasdaq Composite gained 2.8%. The S&P 500 rose 2.5%, extending its winning streak to a sixth consecutive session alongside the Nasdaq.

In commodities, oil markets saw a dramatic reversal. West Texas Intermediate crude plunged around 15%—its steepest daily decline since 2020—to settle near $96.25 per barrel, while Brent crude dropped 13% to $94.75. The sharp fall reflected easing fears over supply disruptions tied to Middle East tensions.

Energy stocks bore the brunt of the selloff. Shares of Chevron fell 4.4%, Exxon Mobil dropped 4.7%, and APA Corporation slid nearly 10%, making it one of the worst performers in the S&P 500.

Bond markets reflected a modest flight to safety unwind, with the 10-year US Treasury yield easing slightly to 4.29% from 4.30%. The US Dollar Index weakened by 0.7% to 99.13, suggesting reduced demand for safe-haven assets.

In alternative assets, gold prices rose 1% to $4,730 per ounce, while Bitcoin climbed to $71,100 after dipping near $69,000 overnight, highlighting continued appetite for both hedges and speculative assets.

Technology stocks led the equity rally, with Meta Platforms jumping 6.5%. Travel-related stocks also surged, with Carnival Corporation rising 11% and Delta Air Lines gaining around 4%, as easing geopolitical risks boosted outlooks for global mobility.

At the company level, Levi Strauss & Co. soared 11% after upgrading its annual revenue and profit forecasts, while Constellation Brands slipped more than 2% ahead of its earnings release.

Market Outlook

Markets are likely to remain highly sensitive to developments surrounding the US–Iran ceasefire. If the truce holds and tensions continue to de-escalate, equities could extend gains, supported by lower energy costs and improved risk sentiment.

However, the situation remains fragile. Any signs of renewed conflict—particularly disruptions to oil supply routes—could quickly reverse recent gains, pushing oil prices higher and triggering renewed volatility across equities, currencies, and commodities.