U.S. stocks surged to one-month highs on Wednesday as a temporary ceasefire between the U.S. and Iran triggered the biggest single-day oil price collapse in years, easing concerns about energy-driven inflation and sparking a sweeping relief rally from airlines to semiconductors.
• State Street Energy Select Sector SPDR ETF shares are sliding. Why are XLE shares down?
President Donald Trump declared on Truth Social that Iran “has gone through what will be a very productive Regime Change” and pledged “there will be no enrichment of Uranium,” adding that many of the 15 negotiating points had been agreed to and that the U.S. would work with Tehran on tariff and sanctions relief.
The session was not without turbulence. Iran’s Foreign Minister Abbas Araghchi signaled that seriousness from the U.S. side would still be required to achieve lasting stability, while an early-morning report of an attack on Saudi Arabia’s vital east-west oil pipeline tested risk sentiment. Iran also signaled that Israeli strikes on Lebanon made after the ceasefire will trigger a strong response.
By midday in New York, WTI crude plunged 15.9% to around $95 per barrel — its steepest single-session drop since April 2020 — as Iran’s agreement to reopen the Strait of Hormuz eliminated a significant geopolitical premium that had built up in energy markets over five weeks of conflict.
Brent crude fell 13.3%, settling near $94.70 per barrel.
The yield on the 10-year U.S. Treasury note fell approximately three basis points to 4.27%, its lowest level in roughly three weeks, as the oil price collapse dampened inflation expectations.
Markets now price in roughly a 35% chance of a Federal Reserve rate cut by year-end, compared with near-zero odds at the start of the week.
Across U.S. equity markets gains were broad-based and led by technology, industrials, and consumer discretionary — precisely the sectors most sensitive to lower oil prices, falling yields and rebounding risk appetite.
The S&P 500 climbed to 6,783, up 2.5% and hitting its highest level in roughly a month. Sandisk Corp. (NASDAQ:SNDK) and Carnival Corp. (NYSE:CCL) were both more than 10% higher, leading within the S&P 500.
The Dow Jones Industrial Average surged 1,298 points, or 2.8%, to 47,882. Sherwin-Williams Co. (NYSE:SHW), Caterpillar Inc. (NYSE:CAT), and Home Depot Inc. (NYSE:HD) led Dow gainers, with advances of 6.9%, 6%, and 5.8%, respectively.
The Nasdaq 100 advanced 3.1% to 24,951. Within Magnificent Seven stocks, Alphabet Inc. (NASDAQ:GOOGL) and Meta Platforms Inc. (NASDAQ:META) each gained 3.7%, with Meta also debuting its first AI model from its superintelligence research group, adding a company-specific catalyst to the tech rebound. Amazon.com Inc. (NASDAQ:AMZN) added 3.7%, while NVIDIA Corp. (NASDAQ:NVDA) rose 2.1% and Microsoft Corp. (NASDAQ:MSFT) advanced 1.7%.
The Russell 2000 climbed 3.1%, with small caps leading gains as the risk-on rotation broadened into rate-sensitive domestic stocks.
Spot gold edged up 1.0% to $4,756 per ounce, while Bitcoin (CRYPTO: BTC) held steady at $71,000.
Wednesday’s Performance In Major U.S. Indices
| Index | Last | % Change |
|---|---|---|
| S&P 500 | 6,783.49 | +2.52% |
| Dow Jones | 47,882.07 | +2.79% |
| Nasdaq 100 | 24,950.70 | +3.09% |
| Russell 2000 | 2,624.93 | +3.14% |
According to the Benzinga Pro platform:
- The Vanguard S&P 500 ETF (NYSE:VOO) gained 2.5%.
- The SPDR Dow Jones Industrial Average ETF Trust (NYSE:DIA) rose 2.8%.
- The Invesco QQQ Trust (NASDAQ:QQQ) climbed 3.1%.
- The iShares Russell 2000 ETF (NYSE:IWM) rallied 3.1%.
Airlines Soar, Chips Surge As Energy Stocks Bear The Brunt
The Energy Select Sector SPDR Fund (NYSE:XLE) was the session’s clear laggard, falling around 4% as oil and gas majors absorbed the full force of the ceasefire-driven crude collapse.
The SPDR S&P Oil & Gas Exploration & Production ETF (NYSE:XOP) led industry losers with a decline of 6.2%.
Exxon Mobil Corp. (NYSE:XOM) tumbled 6.1% to $153.92, ConocoPhillips (NYSE:COP) dropped 6% to $123.92, and Chevron Corp. (NYSE:CVX) slid 5.7% to $189.94 — the three hardest-hit names in the large-cap energy complex.
Airlines were among the day’s biggest winners, with the U.S. Global Jets ETF (NYSE:JETS) surging 6.7% as collapsing jet fuel costs supercharged sector margins. Delta Air Lines Inc. (NYSE:DAL) headlined the sector with a 12% gain after the carrier reported better-than-expected quarterly earnings, creating a powerful double catalyst of strong fundamentals and collapsing input costs.
The Technology Select Sector SPDR Fund (NYSE:XLK) and the Consumer Discretionary Select Sector SPDR Fund (NYSE:XLY) tied for the top spot among S&P 500 sectors, each rising approximately 3%, alongside the Industrials Select Sector SPDR Fund (NYSE:XLI).
The VanEck Semiconductor ETF (NASDAQ:SMH) jumped 5.3% as risk appetite returned to AI-linked names. Intel Corp. (NASDAQ:INTC) surged 9.3%, Lam Research Corp. (NASDAQ:LRCX) rallied 9.1%, Applied Materials, Inc. (NASDAQ:AMAT) rose 8.6%, and Micron Technology, Inc. (NASDAQ:MU) gained 7.8%.
The Industrials Select Sector SPDR Fund was bolstered by General Electric Co. (NYSE:GE), which climbed 7.4%, and Emerson Electric Co. (NYSE:EMR), up 7.1%.
The iShares U.S. Home Construction ETF (BATS:ITB) surged 5.6% as falling Treasury yields lifted homebuilder valuations, while the VanEck Gold Miners ETF (NYSE:GDX) added 4.2% as gold miners benefited from the metal’s 1% daily advance and plummeting oil prices.
Wednesday’s Top 5 Gainers (Russell 1000)
| Company | % Change |
|---|---|
| RPM International Inc. (NYSE:RPM) | +12.93% |
| SanDisk Corporation | +11.57% |
| Ciena Corporation (NYSE:CIEN) | +11.30% |
| Carnival Corp. | +10.54% |
| Amkor Technology Inc. (NASDAQ:AMKR) | +10.37% |
Wednesday’s Top 5 Losers (Russell 1000)
| Company | % Change |
|---|---|
| APA Corporation (NASDAQ:APA) | -10.71% |
| LyondellBasell Industries N.V. (NYSE:LYB) | -10.42% |
| CF Industries Holdings Inc. (NYSE:CF) | -9.11% |
| Chord Energy Corporation (NASDAQ:CHRD) | -9.06% |
| Matador Resources Company (NYSE:MTDR) | -8.23% |
Login to comment