U.S. stock indexes climbed and oil prices fell Thursday after President Donald Trump said he had called off a threat to bomb Iran, raising optimism that talks could reopen crude flows from the Persian Gulf.
The S&P 500 jumped about 1.4%, the Dow Jones Industrial Average rose roughly 839 points (about 1.7%) and the Nasdaq climbed about 1.8% as of 1:45 p.m. Eastern. Small-cap stocks outperformed, with the Russell 2000 up around 2.6%.
Trump posted on his social media network that “discussions and final points have been, in both concept and great detail, approved by all parties involved,” and said the time and place of a signing would “be announced shortly.” The news sparked a quick shift in market sentiment, as investors saw a reduced risk of further disruptions to oil shipments.
Benchmark U.S. crude fell about 3.2% to $87.19 a barrel after giving back earlier gains; Brent crude dropped roughly 3.5% to $89.89. Those prices remain elevated compared with roughly $70 per barrel before the war. An agreement that eased tensions could allow tankers to move more freely through the Strait of Hormuz and help rebuild global supply.
Markets had been on edge after recent exchanges of strikes between the United States and Iran following a fragile ceasefire. While recent attacks were more limited than earlier in the conflict, negotiations to extend the ceasefire were ongoing and investors were sensitive to any signs of escalation.
High oil prices have pushed inflation higher worldwide. A report Thursday showed U.S. wholesale prices rose in May by more than economists had expected, and the European Central Bank became the first major central bank to raise interest rates in response to stronger inflation.
Higher rates are intended to tame inflation but also slow economic growth and weigh on asset prices. That dynamic has amplified volatility, particularly for richly valued sectors such as artificial-intelligence–related stocks. Over the past week AI-driven moves have helped drive large swings in broader markets.
Chipmakers and related suppliers led gains Thursday: Marvell Technology climbed about 6.6% following a stretch of extreme volatility that included a 32.5% one-day surge earlier this year after a favorable comment from Nvidia’s CEO. Lam Research and KLA jumped around 11% and 11%, respectively. At the same time, Oracle slid about 11.6% despite reporting stronger-than-expected quarterly profit after saying it plans to raise roughly $40 billion this fiscal year through borrowing and stock sales to fund AI investments; it had raised about $48 billion last fiscal year for the same purpose.
In the bond market, the yield on the 10-year Treasury eased to about 4.47% from roughly 4.55% late Wednesday as lower oil prices took some pressure off inflation expectations.
Abroad, stocks were mostly higher in Europe and mixed in Asia. London’s FTSE 100 rose about 0.5%, while Hong Kong’s Hang Seng slipped roughly 0.7%.
This account is based on reporting by The Associated Press on June 12, 2026.