Markets Rise on Iran Deal Hopes Amid US Strikes

Equity futures climbed and oil prices swung Tuesday as investors weighed tentative progress toward ending the U.S.-Iran conflict against new American military action near the Strait of Hormuz. Hopes that the waterway could reopen soon supported broader risk appetite, yet the mixed signals left traders uncertain how much of any de-escalation had already been priced in.

Dow Jones Industrial Average futures rose 234 to 305 points, or roughly 0.5 to 0.6 percent, while S&P 500 futures gained 0.7 percent and Nasdaq-100 futures advanced 1 percent, according to multiple market reports citing CNBC and direct exchange data. European indexes finished mixed, with the STOXX 600 down 0.2 percent, London’s FTSE 100 up 0.7 percent and Germany’s DAX off 0.5 percent at 1051 GMT, per Reuters. South Korea’s KOSPI surged 2.55 percent to a record 8,047.51, its first close above 8,000, driven by institutional buying of large-cap names such as Samsung Electronics and SK hynix, Yonhap reported.

Oil markets showed sharper volatility. Brent crude futures traded around $96 to $98.50 per barrel, up as much as 3 percent on the day after earlier losses below $94, while West Texas Intermediate futures fell nearly 5 percent to near $92, according to The Wall Street Journal and CNBC. The $100 threshold for Brent carried symbolic weight after the commodity’s first close beneath that level in more than a month. Silver futures opened at $77.49 per ounce before easing to $76.73, a 1.7 percent gain from Friday’s close, Yahoo Finance data showed.

President Trump said Monday that talks with Iran were “proceeding nicely” and could produce a formal agreement within days, while warning that Washington remained ready to shift to offensive operations if diplomacy collapsed, multiple outlets reported. U.S. Central Command spokesman Tim Hawkins confirmed American forces conducted what he described as defensive strikes on missile-launch infrastructure and vessels suspected of mine-laying in southern Iran, framing the action as consistent with an active ceasefire. Iran’s Islamic Revolutionary Guard Corps said it responded by firing on a U.S. F-35 and drones, claiming it shot down an MQ-9 Reaper; several Iranian personnel were reported killed near Larak Island, according to Iran’s state-run Nour News. Israel’s military stated it took no part in the operation.

Secretary of State Marco Rubio told reporters in India that specific language in an initial document still required negotiation and that reaching a deal could “take a few days.” Market participants continued to assign high probability to some form of agreement that would restore Hormuz traffic, though CME FedWatch data showed traders now pricing in an 8.5 percent chance of a July Federal Reserve rate hike, up from 0.9 percent a month earlier, amid persistent energy-price pressure.

The prior week’s 8.4 percent drop in U.S. crude marked its steepest weekly decline since mid-April. European Central Bank board member Isabel Schnabel said the central bank should still raise rates in June even if a deal materializes, citing the conflict’s longer-than-expected duration and its spillover into inflation.