U.S. Stocks Hit Record High Amid Iran Ceasefire Hopes

Stocks surge past January peak on U.S.-Iran truce talks easing oil fears.

The U.S. stock market hit a record Wednesday after adding to its two-week rally built on hopes the war with Iran won?t create a worst-case scenario for the global economy. The S&P 500 rose 0.8% and eclipsed its prior all-time high set in January. The Dow Jones Industrial Average dipped 72 points (0.1%) while the Nasdaq composite gained 1.6%.

The price for a barrel of Brent crude, the international standard, added 0.1% to settle at $94.93. That?s still well above its roughly $70 price from before the war, though it?s down from its $119 peak when worries about the fighting have been at their heights.

Much of the stock rally stems from expectations of calming war tensions and resuming full oil flows from the Persian Gulf. Hopes stayed high Wednesday as officials reported a U.S.-Iran in principle agreement to extend a ceasefire for more diplomacy. Still, stocks could fall if these hopes falter, as they've done before in the conflict.

Oil prices fluctuated cautiously Wednesday, with global stock indexes showing modest moves after recent gains. Successful U.S.-Iran talks could make the war a temporary economic setback, avoiding sustained high oil prices and inflation. This would refocus investors on corporate profits, which drive long-term stock trends?and analysts see growth continuing.

Bank of America rose 1.8% after saying it made $8.6 billion in profit during the first three months of the year, more than analysts expected. Morgan Stanley jumped 4.5% after the investment bank likewise delivered a better-than-expected quarter of results. ServiceNow climbed 7.3%, Oracle rose 4.2% and Ares Management gained 5.9% for some of Wednesday?s bigger gains in the S&P 500. All are still down between 12% and 39% for the year so far. The stock price of Allbirds surged 582% to nearly $17 after the company said it?s shifting gears and moving into the AI compute infrastructure industry, while changing its name to NewBird AI.

Nike rose 2.8% after CEO Elliott Hill and Tim Cook ? a Nike director and the CEO of Apple ? disclosed that they purchased a combined 48,000 shares of the athletic shoe maker at a cost of about $1 million each. Nike shares are still down nearly 29% this year. Live Nation Entertainment fell 6.3% after a jury found the concert giant and its Ticketmaster subsidiary had a harmful monopoly over big concert venues.

In stock markets abroad, indexes were mixed in Europe following modest gains in Asia. South Korea?s Kospi was an outlier and jumped 2.1%. The U.K.?s FTSE index and France?s CAC 40 are both expected to open slightly below the flatline, Germany?s DAX up 0.13% and Italy?s FTSE MIB up 0.15%, according to data from IG. Japan?s Nikkei 225 rose 2.19%, paring earlier gains after hitting a record fueled by technology and consumer cyclical stocks.

In the bond market, the yield on the 10-year Treasury rose to 4.28% from 4.26% late Tuesday. The yield on the 10-year U.S. Treasury note the key benchmark for government borrowing was up more than 2 bps at 4.27%. The 2-year Treasury note yield which is more sensitive to short-term Federal Reserve interest rate decisions, rose 1 basis point to 3.76%. The longer-dated 30-year Treasury bond yield climbed more than 2 bps to 4.89%.