Stocks Rise Toward Record as Iran Peace Hopes Hold: Markets Wrap
(Bloomberg) — Wall Street kicked off the holiday-shortened week with stocks joining bonds higher as hopes for a peace deal between the US and Iran overshadowed military strikes in the Persian Gulf.
Expectations of an agreement drove the S&P 500 toward a record, with chipmakers leading the charge. Treasury yields fell as concerns over a flare-up in inflation eased, making traders pare back their wagers on near-term Federal Reserve rate hikes. Oil continued to whipsaw on Middle East developments, with Brent topping $100 after slumping more than 7% on Monday.
President Donald Trump said negotiations with Tehran to extend their ceasefire and reopen the Strait of Hormuz are proceeding, though Secretary of State Marco Rubio added that a deal would likely take a few days to finalize. US and Iranian forces clashed near the waterway overnight, highlighting the tension between the two sides.
The US Navy has restarted assisting vessel crossings through Hormuz, the Wall Street Journal reported.
“Doubts about the deal and its detail, especially relating to uranium enrichment and the tolling of the Strait of Hormuz, persist,” said Kyle Rodda at Capital.com. “However, market participants are placing their bets on peace and subsequently buying into very strong equity fundamentals.”
“While we’d like to share the optimism, there have been enough setbacks in the process of crafting an agreement between Washington and Tehran that we’ll remain cautious until there is more tangible progress,” said Ian Lyngen at BMO Capital Markets.
Just because a ceasefire isn’t an immediate catalyst, it will still be a steady positive influence on stocks and bonds as long as growth stays solid and inflation doesn’t spike, according to Tom Essaye at The Sevens Report.
“Don’t expect an agreement to immediately send the S&P 500 running to 8,000, but while the near-term reaction may be a mild disappointment, the reality is that removing distractions and allowing investors to focus on strong earnings and stable growth will increase the rally potential for this market,” he said. The gauge hovered near 7,520.
On the economic front, data showed US consumer confidence edged down in May as views of current economic conditions settled back amid rising prices due to the war. The Conference Board’s gauge fell to 93.1 after an upward revision to the prior month. The median economist estimate was 92.
“Surprisingly, elevated gas prices and geopolitical worries out of the Middle East haven’t seemed to weigh much on this particular reading, although confidence remains well below where it stood before tariff worries surfaced last year,” said Bret Kenwell at eToro.
Corporate Highlights:
Micron Technology Inc. rallied after UBS raised its price target on the memory chipmaker to a Street-high view of $1,625, up from $535. Qualcomm Inc. reached a deal with TikTok owner ByteDance Ltd. to supply chips for artificial intelligence data centers, according to people familiar with the matter, marking a key win for a company trying to expand from smartphone processors into AI infrastructure. Quantinuum Inc., a quantum computing company backed by Honeywell International Inc., is seeking to raise $1.05 billion in its US initial public offering, capitalizing on investor enthusiasm for the technology. Warner Bros. Discovery Inc. boosted a loan sale for a second time, a move that will allow the media giant to fully replace $15 billion of short-term financing. Eli Lilly & Co. is buying three clinical-stage vaccine developers for as much as $3.8 billion, leveraging its obesity-fueled dominance to establish itself as a leader in other areas and become a major player in infectious diseases. Some of the main moves in markets:
Stocks
The S&P 500 rose 0.7% as of 11:10 a.m. New York time The Nasdaq 100 rose 1.6% The Dow Jones Industrial Average fell 0.1% The Stoxx Europe 600 fell 0.4% The MSCI World Index rose 0.4% Currencies
The Bloomberg Dollar Spot Index rose 0.2% The euro fell 0.2% to $1.1622 The British pound fell 0.4% to $1.3444 The Japanese yen fell 0.3% to 159.33 per dollar Cryptocurrencies
Bitcoin fell 0.5% to $76,806.35 Ether fell 0.1% to $2,104.7 Bonds
The yield on 10-year Treasuries declined six basis points to 4.50% Germany’s 10-year yield advanced four basis points to 2.98% Britain’s 10-year yield declined three basis points to 4.87% Commodities
West Texas Intermediate crude fell 2.3% to $94.34 a barrel Spot gold fell 1.3% to $4,512.18 an ounce ©2026 Bloomberg L.P.
