Trump’s announcement to delay strikes on Iran’s energy infrastructure triggered sharp fluctuations in global financial markets on Monday. Oil prices plummeted by over 10%, while gold recovered most of its intraday losses. Major U.S. stock indexes closed up more than 1%, but the rally stalled at intraday highs after Iran quickly denied the existence of any negotiations.
Public information and media reports indicate that officials from Pakistan, Egypt, and Turkey are actively working to bring U.S. and Iranian officials back to the negotiating table. However, it remains unclear whether a path to bridge significant divides between the U.S., Israel, and Iran can be found.
Coincidentally, during the late trading session on Monday, reports emerged that thousands of U.S. Marines were expected to arrive in the Middle East by Friday. Among them, the amphibious assault ship ‘USS Tripoli,’ the amphibious transport dock ‘USS New Orleans,’ and approximately 2,200 troops from the 31st Marine Expeditionary Unit, previously stationed in the Asia-Pacific region, would enter the jurisdiction of the U.S. Central Command. The report also noted that the unit might take several more days to reach the Strait of Hormuz.
Sources also revealed that the U.S. Department of Defense had ordered the amphibious ready group centered around the amphibious assault ship ‘USS Boxer’ and the 11th Marine Expeditionary Unit to head to the Middle East. The unit is expected to depart in several weeks and will require additional weeks to arrive within the Central Command’s area of responsibility.
As for whether Monday’s rebound in U.S. equities can continue, most Wall Street analysts explicitly stated they do not know, as no one can currently predict the next moves in geopolitics.
Chris Larkin, Head of Trading at E*TRADE under Morgan Stanley, commented: ‘The market was awakened by some potential positive developments, but for the rebound to sustain, tangible progress in geopolitics may be required. We still live in a headline-driven market.’
According to CCTV NewsOn the 23rd, U.S. President Trump announced that he had instructed a suspension of all military strikes on Iran’s power plants and energy infrastructure for five days, contingent on the success of ongoing meetings and discussions. Subsequently,CCTV reportedIranian Islamic Consultative Assembly Speaker Kalibaf posted on social media, denying dialogue with the United States.
Following the announcement, Brent crude oil prices plunged over 14% at one point.
Kalibaf stated that the news regarding negotiations was “false information” aimed at manipulating financial and oil markets to help the United States and Israel escape their current “predicament.” The tit-for-tat statements temporarily narrowed the decline in crude oil prices, as Chris Larkin of E*Trade noted:
The market woke up to positive news, but any further rebound would require substantial follow-through at the geopolitical level. We remain in a headline-driven market.
Notably, crude oil futures prices remain high and are in a state of contango, with current futures contract prices suggesting that prices will not return to pre-conflict levels until November 2028.
Brock Weimer of Edward Jones pointed out that the most convincing de-risking signal would be the resumption of actual crude oil flows through the Strait of Hormuz, rather than verbal statements. Bob Doll, Chief Investment Officer of Crossmark Global Investments, stated:
In the short term, nothing is more important than oil prices—when oil prices fall, stock prices rise, and vice versa.
On Monday, the three major U.S. stock indices closed higher across the board, with the Dow Jones Industrial Average surging nearly a thousand points at one point. However, as Iran’s foreign minister denied the news, U.S. stock indices retreated from their intraday highs.
According to Goldman Sachs trader Rich Privorotsky, Trump’s actions over the past 72 hours have followed a fixed pattern: releasing a ‘consideration of de-escalation’ signal on Friday, escalating to the strongest stance on Saturday, and announcing a ‘five-day pause’ on Monday. First creating tension, then setting a deadline, and finally providing a ‘face-saving solution’ in exchange for domestically promotable outcomes.
Dana Stroul, former Deputy Assistant Secretary of Defense for Middle East Affairs, stated outright that Trump’s move appears more like seeking a way out. Striking Iran’s civilian energy infrastructure could constitute a war crime, and the timing of the five-day pause announcement just before the U.S. market opened was ‘no coincidence.’
Furthermore, analysis suggests that a significant portion of Monday’s stock market gains came from short covering rather than new long positions entering the market. The activity level of Goldman Sachs’ trading desk that day was only rated at 3 out of 10, with ETFs serving as the primary driver.
According to data from Bespoke Investment Group, heading into this week, over 50% of S&P 500 components were in an ‘oversold’ condition, while only 5.4% were ‘overbought,’ marking the most extreme reading since last April’s tariff turmoil. Scott Rubner of Citadel Securities pointed out that the current level of short positions in U.S. stocks is historically rare. He said:
The conditions for a rebound are highly favorable as long as geopolitical tensions ease slightly.
However, Bloomberg macro strategist Michael Ball cautioned that Monday’s rebound in the S&P 500 did not alter the core issue: rising oil prices are fueling inflation expectations, which may prompt the Federal Reserve to remain on hold, thereby tightening financial conditions.
From a technical perspective, this rebound merely pulled the index back to the midpoint of the downtrend following recent declines. The S&P 500 remains below its 200-day moving average, with Nasdaq down approximately 3% from pre-conflict levels and the Dow down about 5.5%.
The US Dollar Index fell sharply, declining by 0.5%, with the euro rising to 1.1613 dollars and the pound increasing by 0.7% to 1.3430 dollars. However, analysis indicates that cross-currency basis swaps show persistently high demand for dollar funding, and liquidity pressures have yet to ease, warranting continued attention.
Signs of unusual volatility have emerged in the precious metals market. $黄金/美元(XAUUSD.CFD)$ On Monday, prices fell by approximately 2% to near $4,400 after a brief rebound, but failed to hold onto gains, having retreated cumulatively about 27% from their January peak.
Rich Privorotsky of Goldman Sachs believes that the consecutive four-day decline in gold during overnight trading is not purely driven by fundamentals, but more likely a combined result of sovereign funds liquidating reserves, speculative long positions being unwound, and deleveraging.
Silver/USD (XAGUSD.FX) Copper, on the other hand, recovered its intraday losses on Monday and closed slightly higher. $Copper Miners ETF – Global X (COPX.US)$
On Monday, the Dow and Nasdaq closed up less than 1.4%, while the small-cap index rose approximately 2.3%. The airline industry ETF led gains among U.S. sector ETFs, closing up nearly 3.5%, while the energy sector ETF rose just 1.2%, showing relatively muted performance.
U.S. Equity Benchmark Indices:
The S&P 500 Index rose by 74.52 points, or 1.15%, closing at 6,581.00 points.
The Dow Jones Industrial Average surged by 631.00 points, or 1.38%, to close at 46,208.47 points.
It increased by 299.149 points, or 1.38%, to close at 21,946.76 points. The Nasdaq 100 Index climbed by 290.436 points, or 1.22%, to close at 24,188.59 points.
The Russell 2000 Index rose by 2.29% to close at 2,494.227 points.
The VIX volatility index, also known as the “fear gauge,” fell by 2.35% to close at 26.15, after plummeting from around the psychological level of 30 at 19:10 Beijing time and hitting a daily low of 20.28 at 19:15.
U.S. sector ETFs:
$JETS.US – U.S. Global Jets ETF Up by 3.49%, $Consumer Discretionary ETF-SPDR (XLY.US)$ 、 The Technology Select Sector SPDR® Fund (XLK.US) With gains reaching up to 2.41%, Internet Index ETF – First Trust (FDN.US) 、 $Regional Banking ETF-SPDR KBW (KRE.US)$ 、 $iShares Semiconductor ETF (SOXX.US)$ And minimum increases of at least 1.72%.
The unicorn fund heavily invested in OpenAI, SpaceX, and Anthropic $FUNDRISE INNOVATION FUND LLC(VCX.US)$ Surged for three consecutive days following its listing.
Mag 7:
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The Wind US Magnificent 7 Index rose by 1.36%.
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Tesla increased by 3.5%, Amazon by 2.38%, Meta by 1.81%, NVIDIA by 1.73%, Apple by 1.41%, Google A by 0.40%, and Microsoft by 0.35%.
Semiconductor stocks:
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The Philadelphia Semiconductor Index closed up 1.34% at 7773.132 points.
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Taiwan Semiconductor ADR rose by 2.78%, and AMD by 0.67%.
Chinese concept stocks:
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The Nasdaq Golden Dragon China Index closed up 0.86% at 6800.66 points.
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Among popular Chinese stocks, WeRide closed up 9.2%, Nio and Xpeng both rose by 7.1%, BYD and Alibaba increased by more than 3%, Li Auto rose by 2.5%, while Tencent, Xiaomi, and JD.com gained up to 1.7%.
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The Hang Seng Index overnight trading session closed up 2.76% at 25020 points. The Hang Seng Tech Index overnight trading session closed up 2.68% at 4828 points.
Other individual stocks:
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Circle rose by 0.53%.
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Storage-related stocks declined, with Micron Technology falling over 4%, and Seagate and SanDisk dropping more than 1%. The supply-demand imbalance for memory chips is worsening, and Wedbush forecasts that prices for some products may surge over 100%.
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Airline stocks generally rose, with shares of Alaska Air and United Airlines both increasing over 4%, while American Airlines’ stock also climbed by 3.66%.
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Cruise operator stocks surged significantly, with Norwegian Cruise’s shares rising over 6%, and Carnival Cruise and Viking Holdings both gaining more than 5%.
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$Estee Lauder (EL.US)$ Fell 8%, $PUIG BRANDS SA UNSPON ADS EACH REP 0.5 ORD(PUGBY.US)$ Surged over 12%, amid reports the two parties may reach a merger agreement.
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USA Rare Earth(USAR.US) followed by $Compass Diversified(CODI.US)$ Arnold Magnetics, under its parent company, announced a reciprocal sales and distribution agreement, with the two publicly traded companies rising over 7% and 9% respectively.
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Optical communication sector standout, $Applied Optoelectronics(AAOI.US)$ Rose over 9%, and after-hours trading saw further gains exceeding 3% following an announcement of securing a $5,300 order for 800G modules.
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Telecommunications equipment company $Netgear(NTGR.US)$ Shares surged 15% after hours as reports indicated that the U.S. Federal Communications Commission banned the import of all foreign-made consumer-grade routers.
South Korea concept strengthened, with triple-leveraged South Korea $Direxion Daily South Korea Bull 3X Shares(KORU.US)$ Surged more than 17%.
The blue-chip index in the Eurozone closed up more than 1.3%, with constituent Siemens Energy rising approximately 4.9% and ASML Holding up about 4.2%. The German stock market closed over 1.2% higher, while the Italian banking sector surged more than 3.1%. In contrast, the British stock market fell by over 0.2%.
Pan-European stocks:
The European STOXX 600 Index closed up 0.61% at 576.78 points, experiencing a short-term surge of approximately 25 points starting at 19:05 Beijing time.
The STOXX 50 Index in the Eurozone rose 1.33% to close at 5574.32 points, also seeing a synchronized short-term increase of roughly 280 points.
National indices:
The German DAX 30 Index closed up 1.22% at 22653.86 points. $iShares Germany ETF (EWG.US)$
The French CAC 40 Index ended 0.79% higher at 7726.20 points. $iShares France ETF (EWQ.US)$
The UK FTSE 100 Index fell 0.24% to close at 9894.15 points. $iShares MSCI United Kingdom ETF (EWU.US)$
Sector and Stock Performance:
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Among the blue chips in the Eurozone, Siemens Energy closed up 4.87%, ASML Holding gained 4.18%, Santander rose 4.05%, Saint-Gobain advanced 4.02% to rank fourth, and UniCredit Bank increased by 3.34%.
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Among all the components of the European STOXX 600 Index, Pandora surged 9.19%, Entain climbed 8.24%, Delivery Hero jumped 7.91%, Antofagasta gained 7.32% to rank fourth, while Poste Italiane plunged 6.85% as the second-largest decliner, and Abivax shares fell 7.50%.
International oil prices closed more than 10% lower as investors weighed Trump’s claim of ‘negotiations with Iran’.
Crude Oil:
WTI May crude oil futures fell $10.10, or more than 10.28%, to close at $88.13 per barrel.
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Brent May crude oil futures fell $12.25, or nearly 10.92%, to close at $99.94 per barrel.
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Middle East Abu Dhabi Murban crude oil futures fell 5.79% to $137.92 per barrel.
Natural Gas:
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NYMEX April natural gas futures closed at $2.8910 per million British thermal units. $United States Natural Gas ETF(UNG.US)$
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Editor/Liam
