Stocks Fall on Doubts Over Imminent US-Iran Deal: Markets Wrap
(Bloomberg) — A rally that drove stocks to record highs faltered and oil whipsawed as doubts resurfaced about an imminent US-Iran deal that would revive energy flows through the key Strait of Hormuz.
Following its biggest advance in a month, the S&P 500 fell. US crude settled near $95 after briefly dropping below $90. Prices climbed in late hours on a news report that sounds of several explosions were heard near a port city in southern Iran. Separately, the nation’s state TV said the US military attacked an Iranian oil tanker and was hit back by missiles.
The US is looking to restart the initiative to guide stranded ships though Hormuz that it had paused earlier this week, the Wall Street Journal reported. The plan — which President Donald Trump dubbed “Project Freedom” — had resulted in clashes with Iran and missiles fired at the United Arab Emirates.
Washington is waiting on Tehran to respond to its proposal to reopen the strait, with tensions still high in both the Persian Gulf and in Lebanon. An Iranian official said the nation wouldn’t allow a reopening with “an unrealistic plan,” the Wall Street Journal reported, citing Press TV.
A US intelligence analysis concluded Iran can survive the naval blockade for at least three to four months before facing more severe hardship, according to the Washington Post. Tehran has laid out a set of new rules for vessels seeking to transit Hormuz, according to a document seen by CNN.
Oil will continue to fluctuate wildly until it’s clear whether there’ll be a deal to end the war, according to Citigroup Inc.’s Max Layton.
“In that environment where you basically don’t know if there’s going to be a deal or not — very difficult to predict with this new leadership in Iran — you know you’re going to be subject to news and you’re going to be moving around like crazy,” Layton told Bloomberg Television.
Wall Street’s optimism around a resolution of the war had recently buoyed investor sentiment, which was also bolstered by solid corporate earnings and signs of economic resilience.
“Markets continue to be underpinned by strong and accelerating corporate earnings and resilient economic fundamentals, even as investors navigate ongoing geopolitical uncertainty,” said Mona Mahajan at Edward Jones.
On the economic front, initial jobless claims rebounded slightly after falling in the previous week to near the lowest levels in decades, signaling layoffs remain muted. Friday’s jobs reading is expected to show the first back-to-back monthly increases in payrolls in almost a year.
Corporate Highlights:
Arm Holdings Plc sank as a slowdown in the smartphone industry took a toll on the chip firm’s royalty revenue, overshadowing growth in the AI data-center market. Datadog Inc. surged after the software developer raised its full-year outlook for sales and earnings, far exceeding Wall Street’s expectations. Peloton Interactive Inc. raised its outlook for the full year, suggesting that a turnaround fueled by new commercial offerings and upgraded equipment is on track. Planet Fitness Inc. cut its full-year revenue outlook, citing weaker-than-expected member sign-ups during the typically busy New Year period. Shake Shack Inc. plunged as first-quarter revenue missed expectations due to pressures including rising beef costs and inclement weather. “Both 30-year bonds and the S&P 500 have seen their sensitivity to oil prices grow the longer the Hormuz impasse lingers. Without a deal, everything is taking a hit again, at least until the next time reports of progress appear.”
—Edward Harrison, Macro Strategist, Markets Live. For the full analysis, click here.
Some of the main moves in markets:
Stocks
The S&P 500 fell 0.4% as of 4 p.m. New York time The Nasdaq 100 fell 0.1% The Dow Jones Industrial Average fell 0.6% The MSCI World Index fell 0.4% Currencies
The Bloomberg Dollar Spot Index rose 0.2% The euro was little changed at $1.1740 The British pound fell 0.2% to $1.3570 The Japanese yen fell 0.3% to 156.81 per dollar Cryptocurrencies
Bitcoin fell 1.5% to $80,238.98 Ether fell 2.2% to $2,298.33 Bonds
The yield on 10-year Treasuries advanced three basis points to 4.38% Germany’s 10-year yield was little changed at 3.00% Britain’s 10-year yield was little changed at 4.95% Commodities
West Texas Intermediate crude rose 0.4% to $95.47 a barrel Spot gold rose 0.5% to $4,713.76 an ounce ©2026 Bloomberg L.P.
