The New York Stock Exchange closed higher on Monday, as investors hoped for a potential agreement between Washington and Tehran despite the American blockade of Iranian ports.
After an initial decline, the major indices of the American market turned around: the Dow Jones gained 0.63%, the Nasdaq index rose by 1.23%, and the broader S&P 500 index increased by 1.02%.
“The market is betting that Donald Trump will manage to reach an agreement,” noted Peter Cardillo of Spartan Capital Securities.
President Trump stated on Monday that the Iranians “want to make a deal, at any cost” following failed discussions in Pakistan to end the Middle East conflict.
He also mentioned on Truth Social that 34 ships crossed the Strait of Hormuz on Sunday, the highest number since the start of the blockade by Iran, which restricts maritime traffic.
A fifth of the world’s oil usually goes through this strategic bottleneck, where Tehran has imposed passage fees that have significantly limited maritime traffic in recent weeks in response to Israeli-American attacks.
After rising to $103.87 during the session, the price of Brent crude oil – the international benchmark – fell below $100 at closing following these statements.
The American market initially opened in the red, with Trump threatening to “destroy” any Iranian “fast attack vessel” breaching the blockade.
Decrying an “illegal” act of “piracy,” Iran warned that it would target the ports of its Gulf neighbors if “the security of the ports of the Islamic Republic was threatened.”
“The market reaction is relatively subdued,” observed analysts at Briefing.com.
As for the bond market, the 10-year yield on U.S. government bonds was around 4.30% at 8:15 pm GMT, down from 4.32% at Friday’s close.
Aside from geopolitical developments, investors will also be watching American indicators this week, including Tuesday’s Producer Price Index (PPI) for March.
On the corporate side, earnings season has kicked off with major banks leading the way.
American investment bank Goldman Sachs closed lower (-1.89% at $890.63) despite announcing results above expectations.
The banking group reported a net profit of $5.4 billion (up 18% year-on-year), surpassing analysts’ consensus of $5.08 billion.
The financial performances of JP Morgan (+1.14%), Wells Fargo (+1.41%), and Citigroup (+1.48%) are expected on Tuesday.
“The software sector values are experiencing a spectacular rebound (on Monday) after their recent decline,” noted Briefing.com analysts.
Oracle surged by 12.71%, Crowdstrike gained 6.13%, and Salesforce rose by 4.73%.
Since the beginning of the year, the sector has been heavily affected by concerns about artificial intelligence undermining its economic model. Some major software companies have seen their market capitalization drop by 30% to 50% in just a few months.
