Wall Street Prices In Peace as Stocks Rally on Iran Talk Progress
Fortune reported Thursday that a global stocks rally is sweeping financial markets as investors bet that a resolution to the Persian Gulf conflict is within reach, pushing the S&P 500 to a new record and triggering sharp moves across Asia, bonds, and commodities.
S&P 500 Scores a Fresh Record High
The S&P 500 climbed 1.46% on Wednesday, closing at an all-time high of 7,365.12. Futures edged up a further 0.11% early Thursday. The gains were broad-based across regions. Japan’s Nikkei 225 surged 5.58%. South Korea’s KOSPI added 1.43%. Chinese and Indian benchmarks also advanced. European indices were more subdued, with the FTSE 100 slipping slightly by midday London trading.
Brent crude pulled back to $99 per barrel after trading above $100 for much of the prior week, a sign markets are recalibrating their war-risk premium as diplomacy accelerates.
Retail Traders Lead the Charge
Individual investors are driving a meaningful portion of the buying. Analysts at J.P. Morgan noted that retail participants are returning to pre-conflict purchasing levels. Net retail stock purchases reached $8.3 billion this week, comfortably above the 12-month weekly average of $6.6 billion.
Not everyone is convinced the optimism is earned. UBS economist Paul Donovan cautioned clients that markets are running on faith rather than hard information. He noted that Iran’s policy decisions remain opaque to outside investors, making current pricing a bet rather than a calculation.
Background: Iran Reviewing a 14-Point U.S. Proposal
The rally was lit by Iran’s foreign ministry confirming it is actively reviewing a 14-point U.S. memorandum of understanding aimed at ending the conflict. A spokesperson said Tehran would relay its position to Pakistani intermediaries once its review concludes. The ceasefire formally remains in place.
President Trump declared the war effectively won and said both sides had engaged in productive talks over the prior 24 hours. He simultaneously threatened renewed and intensified bombing if negotiations collapsed, a combination of carrot and stick that has become characteristic of his approach.
Bond Markets Feel the Shift Too
The war’s outbreak pushed government bond yields higher across major economies as debt investors demanded greater compensation for elevated risk. Data from Deutsche Bank showed those yields retreating sharply after the White House announced the operation was over. Trump’s social media activity, long known to move equities, is now demonstrably shifting sovereign debt markets as well, underlining how tightly geopolitics and financial conditions are linked in the current environment.
Fuel costs remain a pressure point. The White House is privately anxious that sustained high jet fuel prices could punish Republicans at November’s midterm elections, adding political urgency to the diplomatic push.
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