US stock futures surged on Wednesday, while oil prices tumbled sharply, as investor sentiment improved following news that the United States and Iran had agreed to a two-week ceasefire that could pave the way for reopening the Strait of Hormuz to global shipping.
Futures tied to the S&P 500 jumped 2.5%, while Nasdaq 100 futures soared 3.3%. Dow Jones Industrial Average futures also climbed 2.4%, gaining roughly 1,100 points.
Wall Street rebounded from overnight lows after US President Donald Trump announced on Truth Social that he would suspend planned military strikes on Iran for two weeks, just hours before a self-imposed deadline. “I agree to suspend the bombing and attack of Iran for a period of two weeks. This will be a double-sided ceasefire,” he wrote, also calling for the immediate reopening of the Strait of Hormuz.
Iran responded shortly after, stating that if attacks cease, its armed forces would halt defensive operations. It added that safe passage through the Strait of Hormuz would be possible during the two-week period, subject to coordination and technical considerations.
Oil markets reacted swiftly to the easing tensions. Brent crude fell 14% to below $94 per barrel, while West Texas Intermediate dropped nearly 15% to around $96, reflecting reduced fears of supply disruptions.
In corporate developments, Delta Air Lines is set to release its quarterly earnings before the opening bell, with investors closely watching for the impact of the conflict, which had disrupted flights and driven up jet fuel costs.
Meanwhile, gold prices climbed as markets recalibrated risk expectations. Bullion rose as much as 3.1% to above $4,850 per ounce, building on gains from the previous session. Analysts say the increase reflects lingering uncertainty, even as the ceasefire lowers the likelihood of prolonged conflict.
The six-week-long crisis has already triggered spikes in energy prices and heightened inflation concerns, potentially influencing central bank decisions. Bond traders now expect the Federal Reserve to hold interest rates steady for the remainder of the year, a factor that could weigh on non-yielding assets like gold.
