Stocks Rebound as Ceasefire Hopes Offset Yesterday's Losses

Market Relief as Pakistan Seeks Iran Deadline Extension

A surge in hopes for a diplomatic resolution to the Middle East conflict has led to a rebound in stocks, with oil prices dropping ahead of President Donald Trump's deadline for Iran to agree to a ceasefire. The S&P 500 erased a 1.2% drop in the final hours of a jittery Wall Street session, while US crude oil prices slipped to around $112 in late trading.

The US dollar and bond yields also fell, as markets sought relief from the geopolitical tensions. Pakistan's request for a two-week extension of the deadline for Tehran to reopen the Strait of Hormuz was seen as a positive development, with markets looking for any sign of a potential breakthrough in the negotiations.

Trump had earlier threatened to wipe out Iran's "whole civilization" if a ceasefire agreement was not reached by his Tuesday 8 p.m. deadline. However, mediators are racing to keep ceasefire talks on track after Iran responded by halting its participation in the discussions.

Read also: Treasury Yields Experience Largest Increase in Two Weeks Following Release of Labor Market Data

Key Economic Data

The recent surge in oil prices has had a significant impact on the US economy, with consumers anticipating higher gas and food prices. According to a Federal Reserve Bank of New York survey, near-term inflation expectations jumped by the most in a year in March.

Fed Bank of New York President John Williams expressed a largely unchanged outlook for underlying price pressures, despite expecting higher energy costs to boost overall inflation. His Chicago counterpart, Austan Goolsbee, raised concerns about the US economy, citing the spike in oil prices and low hiring by businesses.

Read also: US-Iran Tensions Spark Uptick in Oil Prices Amid Global Market Decline

Corporate Highlights

Apple Inc.'s first foldable phone is on track to arrive during the company's normal iPhone launch period later this year, according to people with knowledge of the matter. Intel Corp. is joining Elon Musk's effort to develop semiconductors for Tesla Inc., SpaceX, and xAI, marking a surprising twist in the chipmaker's comeback bid.

Pacific Investment Management Co. is in talks with Bank of America Corp. to provide roughly $14 billion of debt financing to build a massive Oracle Corp. data center in Michigan. Anthropic PBC said its revenue run rate has now topped $30 billion, up from $9 billion at the end of 2025, and confirmed plans to work with Broadcom Inc. and Google to power its operations.

Bill Ackman is pitching a deal for Universal Music Group NV, the record label giant behind celebrities including Taylor Swift and Drake, that he claims will dramatically boost the value of the company by moving its listing to the US. Shares of major insurance companies climbed as the US Medicare program will pay private insurers 2.48% more in 2027.

Market Overview

The Bloomberg Dollar Spot Index fell 0.3%, while the euro rose 0.5% to $1.1599. The British pound rose 0.4% to $1.3294, and the Japanese yen was little changed at 159.55 per dollar.

Cryptocurrencies fell, with bitcoin dropping 0.6% to $69,433.49 and ether falling 1.4% to $2,118.61. The yield on 10-year Treasuries declined three basis points to 4.30%, while Germany's 10-year yield advanced nine basis points to 3.08%. Britain's 10-year yield advanced seven basis points to 4.90%.

West Texas Intermediate crude fell 0.4% to $111.93 a barrel, while spot gold rose 1.3% to $4,709.82 an ounce.