US equities rallied on Wednesday after President Trump agreed to a temporary ceasefire with Iran and stepped back from the large-scale strikes he had threatened. The S&P 500 and Dow Jones Industrial Average climbed 2.5%, while the Nasdaq 100 advanced nearly 3%, with all three indices closing at one‑month highs.
The ceasefire, set to last for two weeks, reportedly includes provisions for unhindered tanker passage through the Strait of Hormuz. At the same time, officials from Oman and other GCC nations opposed Tehran’s proposed toll system at the strategic chokepoint. However, intermittent strikes between Iran and Israel and temporary disruptions to tanker traffic continued to cast doubt over the durability of the agreement.
Oil prices fell sharply and Treasury yields declined as markets pared back concerns about energy‑driven inflation. The rebound in risk appetite supported broader asset prices despite fresh warnings of stagflation risks in the latest FOMC minutes. High‑beta AI and technology names outperformed, with Nvidia, Meta, Tesla, AMD, and Micron jumping between 4% and 10%. Airlines also rallied on the improved outlook for jet fuel supply, while Delta gained 6% after reporting earnings.
