The three major U.S. stock indexes in New York closed higher for a second straight day. Optimism that the United States and Iran can keep a cease-fire in place appeared to lift stocks.
On the 9th (local time) at the New York Stock Exchange (NYSE), the Dow Jones Industrial Average finished at 48,185.80, up 0.58% from the previous day. The Standard & Poor's (S&P) 500 index rose 0.62% to 6,824.66 from the prior session, and the Nasdaq rose 0.83% to 22,822.42. In particular, the S&P 500 climbed for seven straight sessions, its longest winning streak since October last year.
Stocks wobbled early in the session. Reports that the reopening of the Strait of Hormuz, a condition of the U.S.-Iran cease-fire, was running into snags weighed on sentiment. Iran said it would cap ships transiting the strait at 15 per day, intensifying concerns about the cease-fire's sustainability.
But sentiment flipped in the afternoon. Stocks rebounded after Israel said it would enter direct talks with the Lebanese government. Hopes that tensions on the Lebanon front—long seen as the biggest wild card for a cease-fire deal—could ease helped lift investor sentiment.
U.S. President Donald Trump also expressed optimism about the talks. In a phone interview aired by NBC that day, Trump said, "Iranian leaders are much more reasonable at the negotiating table," adding that "the end-of-war talks are very optimistic."
International oil prices closed higher after sharp intraday swings. At the London ICE Futures Exchange, Brent crude settled at $95.92 per barrel, up 1.23% from the previous session. West Texas Intermediate (WTI) also finished up 3.66% at $97.87.
The market is split between optimism and caution. Oliver Pursche of Wealthspire Advisors said, "In the current environment, investors have to choose whether to trust this or take cash." Rick Wedell, chief investment officer at RFG Advisory, also noted, "A cease-fire is positive, but if the Strait of Hormuz issue drags on, supply shocks could persist."