Stock Market Rally Following Iran’s Announcement
Stocks surged on Friday, hitting a new milestone after Iran declared that the Strait of Hormuz was “fully open” amid a ceasefire between Israel and Lebanon.
Just two days after the S&P 500 index closed above 7,000 for the first time, it reached an all-time high of over 7,100. The Nasdaq Composite Index also saw its 13th consecutive day of gains, marking the best performance for a tech stock index since 1992.
Interestingly, crude oil prices fell as stock prices climbed. Brent crude dropped by 9% to $90.56 per barrel, while West Texas Intermediate oil prices fell 11% to $84.56.
The reopening of this crucial shipping route was shared by Iran’s foreign minister via a post on social media. This news alleviated some of the market concerns that had been prominent throughout March regarding potential extended supply disruptions in the Middle East.
“In line with the ceasefire in Lebanon, we announce that all commercial shipping routes through the Strait of Hormuz will be fully open during the ceasefire, following the coordinated route already established,” stated Foreign Minister Seyyed Abbas Araghchi.
Meanwhile, the major U.S. indices saw significant gains, with the Dow Jones Industrial Average up by 1,100 points. The S&P 500 also showed momentum, which could potentially disrupt its streak of gains over the past 12 days.
This development has raised hopes that the Federal Reserve might consider a rate cut. Expectations for a reduction climbed to 52% on Friday from 30% the day before, according to the CME FedWatch tool.
However, some experts, like Joseph Bourslas, chief economist at RSM US, caution that the long-term effects of war on oil supplies could linger. He noted it may take years to restore the energy infrastructure that has been impacted by conflict. “Oil prices will likely drop, but we shouldn’t expect them to return to pre-war levels,” he remarked.
Since the ceasefire, investors seem eager to re-enter the market. There appears to be growing optimism that the ongoing conflicts in the Middle East might soon conclude, especially as President Trump has been reassuring investors about potential peace deals.
In a recent event in Las Vegas, Trump expressed that he believes the situation with Iran is “progressing well” and stated that “the war should be over soon.”
A significant portion of the market rally has been attributed to renewed interest in tech stocks, which had suffered previously due to concerns surrounding AI and market volatility linked to Iran. The iShares Enhanced Technology Software Sector ETF had entered a bear market in early 2026 but has since risen by 14% since the previous Friday.
“Now that stocks are hitting new highs, it seems like the correction influenced by Iran is behind us,” noted Paul Stanley, chief investment officer at Granite Bay Wealth Management. “While a correction might involve revisiting previous lows, long-term investors will likely see this as a buying opportunity.”
