The stock market surged on June 11 after President Trump announced he was canceling planned strikes on Iran and signaled a peace deal with Tehran is imminent, sending investors rushing back into equities on hopes of easing geopolitical tensions.
The Dow Jones Industrial Average added 930 points, or 1.9%, closing the day sharply higher. The S&P 500 advanced 1.8% to 7,394.30, marking its largest single-day gain since April, while the tech-focused Nasdaq Composite jumped 2.5%, according to the Wall Street Journal and CNBC.
The rally reflected investor relief that a potential military escalation was off the table. Brent crude futures fell 2.9% to $90.38 a barrel as traders bet on a return to normalcy in the Strait of Hormuz, a critical chokepoint through which roughly one-fifth of global oil supplies flow in peacetime.
“We just made a great settlement of the war with Iran,” Trump told reporters at the White House, adding the deal was “subject to finalisation of documents.” He suggested an agreement could be signed as soon as this weekend. Iran has not publicly confirmed Trump’s claims, though a Ministry of Foreign Affairs spokesman told reporters a memorandum of understanding with the U.S. is “under consideration.”
The U.S. stock market’s gains extended into Asia on Friday. South Korea’s Kospi surged more than 8% in morning trading, Japan’s Nikkei 225 rose as much as 4%, Taiwan’s TAIEX gained about 2.4%, and Australia’s ASX 200 rose about 1.8%, according to Al Jazeera.
The broader rally was driven by what market analysts called a “meaningful easing of geopolitical risk.” Fabien Yip, a market analyst at the online broker IG Group in Sydney, told Al Jazeera that the market reaction reflected genuine dip-buying interest and suggested the week’s decline looked “less like a structural break in the bull market and more like a healthy reset after a rapid, near-straight-line advance.”
For the rally to sustain, however, investors will want to see more than just a signed deal. Khoon Goh, head of Asia research for ANZ Bank, told Al Jazeera that “only” a complete reopening of the Strait of Hormuz would allow “the gains to extend.” Oil prices and market sentiment have been tightly linked throughout the Iran conflict, with supply disruptions and shipping concerns driving volatility since the war began earlier this year.
Sources
- Wall Street Journal — Dow surge, S&P 500 and Nasdaq gains, oil price decline, Trump’s announcement of canceled strikes
- CNBC — Dow surge of 900 points, S&P 500 gain to 7,394.30, Nasdaq performance
- Al Jazeera — Stock market surge details, Asian market rallies, analyst commentary from ANZ Bank and IG Group
- Business Insider — Stock market surge following Trump’s cancellation of Iran strikes
