Wall Street scaled fresh records on Wednesday as optimism grew that the US-led conflict with Iran was nearing its end. The benchmark S&P 500 breached 7,000 points for the first time in history, rising 0.8% to close at 7,022.95, while the tech-heavy Nasdaq climbed 1.6% to 24,016.02, also an all-time high. The Dow Jones industrial average remained broadly flat.
The rally erased the stark losses incurred during the early days of the war. The S&P 500 has advanced significantly since the US and Iran announced a two-week ceasefire last week. Speaking on Wednesday, President Donald Trump claimed the war was "very close to over", expressing hope that the conflict and its associated volatility in oil markets would soon conclude. "We've beaten them militarily, totally," he told Fox Business. "I think they want to make a deal very badly." The White House later denied that it had requested an extension to the ceasefire, which is set to end on 22 April, but described talks as "productive and ongoing".
Adding to the positive mood were quarterly earnings from Bank of America and Morgan Stanley, both of which beat trading estimates, suggesting resilience in the economy despite the conflict. Brian Moynihan, chief executive of Bank of America, told CNBC: "The consumers are spending, the credit quality is very good and improving, and you see the corporate clients actually use their lines a little bit more. We all face that same uncertainty, but right now, the US companies and consumers are doing well, and frankly, our global companies are doing pretty well."
Wall Street appeared unfazed by reports that the US would conduct its own blockade of the Strait of Hormuz, through which a fifth of the world's oil and gas products typically pass. According to the Wall Street Journal, 15 warships and possibly thousands of US service members have been sent to block all ships from passing through, after peace talks with Tehran collapsed over the weekend. Brent crude, the global benchmark, dropped 10% following the ceasefire announcement to trade at around $95 a barrel, still about 35% higher than before the conflict.
