Stocks Rise, Oil Slides After Trump Inks Iran Deal: Markets Wrap

(Bloomberg) — US stocks rebounded and oil prices fell as some energy shipments began to transit the Strait of Hormuz, hours after President Donald Trump signed a preliminary deal to end the war in the Middle East.

S&P 500 futures climbed 0.7% while Nasdaq 100 contracts rallied 1.4%. Intel Corp.’s shares jumped more than 8% in premarket trading after Trump said the firm struck a chipmaking deal with Apple Inc. The gains partly unwound a more than 1% decline in the S&P 500 after Federal Reserve policymakers signaled they may have to raise interest rates this year to contain inflation.

Brent slid 1.4% to around $78.50 a barrel and touched its lowest level since the start of the war. Three laden oil vessels controlled by Saudi Arabia’s state tanker giant switched on their signals in the Gulf of Oman after being stuck inside the Persian Gulf since the conflict began.

Despite lower oil prices, front-end Treasury yields remained at their highest level since February 2025, with traders cementing bets for a September US rate hike. In the UK, the yield on two-year gilts jumped six basis points to 4.2%, while the Bank of England kept guidance that it “stands ready to act” on inflation and left its key rate unchanged. The dollar extended gains.

Ahead of the last trading day of the week for US markets, the peace deal is reducing the risk of further energy-supply disruptions. Stocks have largely shrugged off the turmoil and continued to notch record highs on the back of relentless enthusiasm for artificial intelligence.

Equity markets have come through the tests posed by the debut of SpaceX, Kevin Warsh’s first meeting as Fed chair and the US-Iran peace deal fairly unscathed, said Raphael Thuin, head of capital market strategies at Tikehau.

“With the MOU now signed, there’s reason to believe that we may be close to or past peak inflation,” Thuin said. “The market will be able to concentrate on earnings again, like for Micron next week.”

Bond investors, however, face the prospect of lingering risks that may keep the higher-for-longer rates narrative intact. Even though US gasoline prices have dipped below $4 a gallon for the first time since March, energy costs have only been one factor in keeping inflation stubbornly above the Fed’s target.

What Bloomberg Strategists Say:

“Expectations of a dovish leaning Federal Reserve have been acting as a constraint the dollar. That narrative is rapidly unraveling after the latest FOMC meeting and, as markets move beyond Iran and refocus on the data, the dollar will strengthen.”

— Skylar Montgomery Koning, macro strategist. Click here for the analysis.

Wednesday’s Fed decision marked the fourth consecutive meeting in which policymakers left rates unchanged. Officials described economic growth as “solid” and highlighted strong productivity gains and capital investment, while making clear that inflation has become a greater concern than labor-market weakness.

“Half the committee is expecting rate hikes this year, which is a real shot across the bow at the market,” said Bob Michele, chief investment officer and global head of fixed income at JPMorgan Asset Management. “I think they’re getting ready for rate hikes.”

Corporate Highlights:

SpaceX shares fluctuated in premarket trading following the previous session’s drop, as it wraps up its first week as a public company following a record-breaking listing. BHP Group said it expects the expansion of its giant Jansen potash mine to cost US$6.9 billion, the latest in a series of cost and time overruns. Credit Agricole SA is considering increasing its stake in Banco BPM SpA as it mulls how to respond to a wave of dealmaking in Italy’s banking sector, according to people familiar with the matter. Tesco Plc’s sales rose less than expected in the fiscal first quarter as the UK’s biggest supermarket grapples with weaker consumer sentiment and a tough comparison with last year. An Oaktree Capital Management private credit fund saw redemption requests drop by nearly half in the second quarter, making it the first major firm to stem a growing exodus from the $1.8 trillion industry. Stocks

S&P 500 futures rose 0.7% as of 7:15 a.m. New York time Nasdaq 100 futures rose 1.4% Futures on the Dow Jones Industrial Average rose 0.4% The Stoxx Europe 600 fell 0.6% The MSCI World Index fell 0.3% Currencies

The Bloomberg Dollar Spot Index rose 0.2% The euro fell 0.4% to $1.1459 The British pound fell 0.6% to $1.3215 The Japanese yen fell 0.2% to 160.95 per dollar Cryptocurrencies

Bitcoin fell 0.6% to $63,991.18 Ether was little changed at $1,744.68 Bonds

The yield on 10-year Treasuries declined two basis points to 4.46% Germany’s 10-year yield advanced two basis points to 2.94% Britain’s 10-year yield advanced three basis points to 4.78% Commodities

West Texas Intermediate crude fell 1.8% to $75.38 a barrel Spot gold fell 0.2% to $4,247.01 an ounce This story was produced with the assistance of Bloomberg Automation.

–With assistance from Shikhar Balwani, Neil Campling and James Hirai.

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