Stocks, Bonds Rise as US-Iran Hopes Spur Oil Drop: Markets Wrap
(Bloomberg) — Wall Street traders lifted stocks and bonds as the latest sign of easing Middle East tensions sank oil prices, allaying worries about inflation.
The revival in risk appetite sent the S&P 500 up about 1%, with the gauge also buoyed by solid earnings. A gauge of the Magnificent Seven megacaps climbed 3% as Amazon.com Inc.’s value topped $3 trillion. US crude sank below $80. Treasury yields fell after last week’s intense volatility.
Iran suggested negotiations to get more ships moving through the Strait of Hormuz are making progress, after President Donald Trump called off what he said was a major attack on the Islamic Republic. While some ships are crossing the waterway, there’s still a significant threat to vessels.
“The market is poised to get an early boost from falling oil, but the on-again, off-again nature of US-Iran diplomacy could mean earnings and jobs data will have to do the heavy lifting for the bulls this week,” said Chris Larkin at E*Trade from Morgan Stanley.
On the economic front, US manufacturing activity expanded in July at the fastest pace in more than four years as demand remained strong, production surged and firms added workers.
Momentum-style equity investing is poised to rebound from a sharp retreat as sectors with strong earnings replace chip stocks in leading the market’s gains, Morgan Stanley strategist Michael Wilson said.
After one of the “worst momentum selloffs in history,” Wilson said the style is rotating toward so-called quality shares with a stable earnings history.
Traders will also keep a close eye on this week’s jobs readings. Employers in the US likely stepped up their pace of hiring in July, showing a steady appetite for workers despite the overhang of geopolitical concerns and elevated inflation.
Elsewhere, the yen climbed on speculation that authorities may have intervened to prop up the currency again after coordinated action between the US and Japan last week.
Corporate Highlights:
AstraZeneca Plc has explored an acquisition of Bristol-Myers Squibb Co., according to people familiar with the matter, in a potential megadeal that would rank as the largest ever in pharma. Northrop Grumman Corp. has secured agreements worth as much as $3 billion to supply key components for missile interceptors produced by Lockheed Martin Corp., part of a broader effort to boost output of munitions drawn down by the Iran war. Marriott International Inc. reported second-quarter earnings that beat estimates as booking demand drove higher room prices at US hotels. AMC Entertainment Holdings Inc. generated its highest-ever total weekend revenue, driven by the opening of Spider-Man: Brand New Day. Tyson Foods Inc. cut its annual profit outlook, signaling that any relief for the US beef industry from a historic cattle shortage is still a long way off. What Bloomberg strategists say…
“Chairman Kevin Warsh’s limited guidance on the Fed’s reaction function means upcoming data, oil prices and the bond market will have a greater influence on the market’s expectations for the policy path.”
—Michael Ball, Macro Strategist, Markets Live. For the full analysis, click here.
Some of the main moves in markets:
Stocks
The S&P 500 rose 0.9% as of 10:04 a.m. New York time The Nasdaq 100 rose 0.6% The Dow Jones Industrial Average rose 1.4% The Stoxx Europe 600 rose 0.5% The MSCI World Index rose 0.8% Currencies
The Bloomberg Dollar Spot Index fell 0.1% The euro was little changed at $1.1520 The British pound fell 0.3% to $1.3449 The Japanese yen rose 0.6% to 156.52 per dollar Cryptocurrencies
Bitcoin fell 0.4% to $63,176.74 Ether fell 1.5% to $1,854.17 Bonds
The yield on 10-year Treasuries declined four basis points to 4.69% Germany’s 10-year yield declined six basis points to 3.15% Britain’s 10-year yield declined nine basis points to 4.96% Commodities
West Texas Intermediate crude fell 6.4% to $79.28 a barrel Spot gold fell 0.4% to $4,029.52 an ounce ©2026 Bloomberg L.P.
