Stocks Reach New Highs as Tech Earnings Surge and Oil Falls on Iran Deal Hopes

U.S. stocks surged to new record levels on Wednesday, propelled by robust earnings from AI‑focused chip makers and reports that Washington and Tehran are nearing a peace agreement. The Dow Jones Industrial Average rose 1.24%, the S&P 500 gained 1.46%, and the Nasdaq Composite jumped 2%, each hitting fresh highs. European markets followed suit, with the STOXX 600 up 2.2% after a 0.7% gain the previous day, and MSCI's All‑Country World Index climbing 1.64% to a new peak.

Oil prices dropped sharply as the prospect of a US‑Iran deal eased geopolitical tensions around the Strait of Hormuz. Brent crude fell to just below $100 per barrel, its lowest in two weeks, before settling 7.83% lower at $101.27, while U.S. West Texas Intermediate slid about 7% to $95.08. The U.S. dollar slipped 0.3% against major currencies, and the yen surged up to 1.8% versus the dollar, sparking talk of possible intervention.

Bond markets also reacted, with the 10‑year U.S. Treasury yield decreasing 6.4 basis points to 4.352% as traders trimmed expectations of further rate hikes. Despite the rally, volatility in energy and bond sectors could temper global growth, given oil is now roughly 35% higher than at the conflict’s onset and Treasury yields sit about 40 basis points above earlier levels. Analyst Michael Brown noted the market appears to be in a 'buy everything' mode, front‑running positive outcomes before any formal confirmation.