US stocks opened higher on Tuesday as investors assessed the possibility of a conclusion to military actions against Iran within four to six weeks, following reports that former President Trump is seeking to end the war.
The Dow Jones Industrial Average rose by 541.54 points, or 1.20%, to 45,757.68. The Nasdaq Composite increased by 274.01 points, or 1.32%, to 21,068.65. The S&P 500 climbed 70.16 points, or 1.11%, to 6,413.88.
Reports indicated that Trump is considering winding down military operations, with a strategic focus on diminishing Iran's naval and missile capabilities. Following these remarks, US Treasury yields edged lower across the board. The yield on the 10-year Treasury note fell to 4.32%, while the 2-year yield declined to 3.82%.
The report also stated that Trump has informed aides of his willingness to end military hostilities in the Middle East, even if the Strait of Hormuz remains largely closed.
Technology stocks, which have been under pressure since the conflict began, saw broad gains. The Technology Select Sector SPDR Fund advanced 0.6%. NVIDIA rose 1%, and Microsoft increased by nearly 2%.
However, crude oil prices remained elevated after another media report indicated that Iran attacked a Kuwaiti oil tanker in Dubai waters. The Dubai government media office posted on X that no injuries were reported and all 24 crew members were confirmed safe.
Brent crude futures increased by 4%, trading above $117 per barrel, while West Texas Intermediate crude futures rose nearly 1%, surpassing $103 per barrel.
Wall Street had a mixed performance in the previous trading session. The S&P 500 and Nasdaq Composite declined, while the Dow Jones Industrial Average posted a slight gain.
Monday's drop in the S&P 500 left it just over 9% above its closing high, with the decline led by the technology sector, which fell more than 1%. However, Art Hogan, Chief Market Strategist at B. Riley Wealth Management, suggested that the recent pullback may reflect a normal market correction rather than an anomaly.
He stated, "There are several narratives at play, but long-term investors should remember that a 10% correction is normal. It happens from time to time. On average, we experience a 10% correction every two years, and investors must understand that market volatility is the price paid for higher long-term returns."
He added, "We also see some up days when there's a hint of positive news."
Tuesday marked the final trading day of the month. The S&P 500 has fallen 7.8% so far in March. If this decline holds through the close, it would be the benchmark index's worst monthly performance since September 2022, when it plummeted 9.3%.