A decline in oil prices boosted U.S. stocks, as the market hopes the U.S. and Iran can reach a deal to end the war that has disrupted financial markets and heightened inflation concerns. Nvidia shares experienced significant volatility after reporting earnings post-market.
Following reports that U.S. President Trump stated the handling of the Iran issue is entering its "final stages," U.S. crude oil fell to around $98 per barrel.
The S&P 500 index rose 1.1%. Long-term U.S. Treasury yields retreated from their highest levels since 2007.
The Tasnim News Agency reported that Iran is evaluating the U.S. response to a peace proposal but has not yet replied.
"Everyone hopes the war will end, but so far, negotiations still have major differences on key issues, with both sides waiting for the other to make the first concession," said senior strategist Louis Navellier. "Even if an agreement is reached, it may take some time to confirm that the deal won't be broken before things can fully return to normal."
Before the rebound in U.S. stocks on Wednesday, the market had fallen due to concerns that the Iran war would drive up energy costs and intensify inflationary pressures.
Minutes from the Federal Reserve's April meeting showed that most Fed officials warned that if inflation remains persistently above the 2% target, the central bank may need to consider raising interest rates.
However, this is not the first time the market has shown optimism without clear progress in U.S.-Iran negotiations.
Steve Sosnick of Interactive Brokers stated: "We certainly hope today's remarks about the final stages are true, but given past experiences, we remain reasonably skeptical about achieving this in the short term."
At the close, the S&P 500 index rose 1.1% to 7,432.97 points; the Dow Jones Industrial Average rose 1.3% to 50,009.35 points; the Nasdaq Composite Index rose 1.5% to 26,270.36 points; the Nasdaq 100 Index rose 1.7% to 29,297.7 points; the Russell 2000 Index rose 2.6% to 2,817.365 points.
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