US Stocks Rebound Amid Ongoing Tensions in West Asia, S&P 500 Surges 1%

U.S. Stocks Bounce Back Amid Slowing Oil Prices

The U.S. stock market experienced a significant rebound on Tuesday, with the S&P 500 jumping 1.2% in a day after it fell more than 9% below its all-time high set early this year. The Dow Jones Industrial Average was up 400 points, or 0.9%, as of 9:35 a.m. Eastern time, and the Nasdaq composite was 1.6% higher.

The rebound in the stock market can be attributed to the steadying of oil prices, which took some pressure off Wall Street. The price for a barrel of Brent crude oil, the international standard, inched down by less than 0.1% to $107.37. Benchmark U.S. crude rose 0.7%. Oil prices have been a major factor in the U.S. stock market's sharp swings since the war with Iran began, with Brent shooting from roughly $70 per barrel to as high as $119 at times.

The market's optimism was fueled by a report from The Wall Street Journal stating that President Donald Trump is willing to end the U.S. military campaign against Iran even if the Strait of Hormuz remains largely closed. The Strait of Hormuz is a narrow waterway off Iran connecting the Persian Gulf to the open ocean, and a fifth of the world's oil sails through it on a typical day.

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Oil Prices and Inflation

Oil prices have already shot high enough that inflation in Europe accelerated to 2.5% in March, up from February's 1.9%. In the United States, the price for a gallon of gasoline topped $4 per gallon for the first time since 2022. This has been squeezing budgets for U.S. households and preventing them from spending on other things.

Tech Stocks Lead the Market

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

Tech stocks were the strongest forces lifting the market, with Marvell Technology climbing 7.6% to help lead the market after Nvidia invested $2 billion in the company and announced a partnership with it. Nvidia, which is Wall Street's most influential stock because it's the largest, rose 1.9%.

Bond Market

In the bond market, Treasury yields eased again. The yield on the 10-year Treasury fell to 4.30% from 4.35% late Monday and from 4.44% at the end of last week. This is a significant move for the bond market, and lower yields should pull downward on rates for mortgages and other loans for U.S. households and businesses, which have shot upward since the war began.

Global Markets

In stock markets abroad, indexes rose in Europe following a tougher finish in Asia. South Korea's Kospi fell 4.3%, and Japan's Nikkei 225 lost 1.6% for two of the bigger moves.