Stocks and Bonds Charge Higher as Oil Slides: Markets Wrap
(Bloomberg) — US stocks pushed higher as optimism mounted that the war in the Middle East is nearing a conclusion, pulling Brent briefly below $100 a barrel and lifting bonds. The dollar posted its biggest drop in a week.
The S&P 500 is poised to add 0.5% to its biggest daily advance since May, driven by President Donald Trump saying he foresaw the US ending the war with Iran within two to three weeks. European stocks jumped 2%, alongside a 4.8% surge in Asian shares.
Brent fell 5.4% before trimming the move as the Strait of Hormuz remained largely closed and missile and drone attacks continued across the Gulf. Traders pared bets on tighter monetary policy, sending two-year Treasury yields three basis points lower to 3.76%. Comparable UK gilt yields dropped eight basis points to 4.32%.
It would take time for oil flows to return to normal even if the war ends within Trump’s timeframe, especially with some energy facilities damaged during the conflict. Trump’s team has also suggested that reopening Hormuz strait, which carries about 20% of global crude, may not be necessary to end the hostilities.
“The correlation between Brent oil prices and global equity markets has been exceptionally strong since the conflict started,” said Wolf von Rotberg, equity strategist at Bank J Safra Sarasin. “This goes to show that a return to previous equity market highs would need the Strait of Hormuz to reopen and oil prices to drop significantly. It is probably too early for an all-clear yet.”
Trump, who will give an address at 9 p.m. Eastern Time to provide an “important update” on Iran, said the Islamic Republic could still reach a deal with the US. He added, however, that an agreement with Tehran isn’t a prerequisite to conclude the war.
“We are seeing a relief rally, and with more information we may see a reversal, so we just need to be careful here,” Remi Olu-Pitan, multi-asset growth and income head at Schroders, told Bloomberg TV. “There’s still a lot of volatility, the market is still fragile.”
Chipmakers extended their rebound in premarket trading, with Sandisk Corp. rising more than 3%. Nike Inc. plunged 10% after a gloomy outlook. Miners including AngloGold Ashanti Plc and Newmont Corp. climbed as gold advanced for a fourth straight day, topping $4,700 an ounce.
What Bloomberg strategists say…
“The sea of green in stocks is a classic sign of markets starved for good news latching onto a sliver of hope, but traders need to look at crude prices — not headlines — as a true barometer of what the global economy is up against.”
— Ven Ram, macro strategist. For the full analysis, click here.
Trump called on other nations to take control of the Strait of Hormuz. So far, the UAE is the only Gulf Arab country that has said it will join a naval force to try to reopen the strait or provide escorts. Bahrain is working on a UN Security Council resolution to give a mandate to a such a task force.
“I would expect further volatility in the days to come and the market to oscillate between losses and gains for a few more sessions until we get clarity on how the crisis unfolds,” said Alexandre Baradez, chief market analyst at IG Markets. “This is likely more a temporary respite than a final game changer.”
Some of the main moves in markets:
Stocks
S&P 500 futures rose 0.5% as of 6:26 a.m. New York time Nasdaq 100 futures rose 0.6% Futures on the Dow Jones Industrial Average rose 0.5% The Stoxx Europe 600 rose 2% The MSCI World Index rose 0.9% Currencies
The Bloomberg Dollar Spot Index fell 0.3% The euro rose 0.4% to $1.1597 The British pound rose 0.6% to $1.3310 The Japanese yen was little changed at 158.69 per dollar Cryptocurrencies
Bitcoin rose 0.5% to $68,513.45 Ether rose 1.2% to $2,131 Bonds
The yield on 10-year Treasuries declined three basis points to 4.28% Germany’s 10-year yield declined four basis points to 2.97% Britain’s 10-year yield declined seven basis points to 4.85% Commodities
West Texas Intermediate crude fell 1.3% to $100.07 a barrel Spot gold rose 1.2% to $4,725.02 an ounce This story was produced with the assistance of Bloomberg Automation.
–With assistance from Julien Ponthus and Subrat Patnaik.
©2026 Bloomberg L.P.
