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Stocks Rally Worldwide, Oil Prices Ease04/01 12:32
Stocks are rushing higher worldwide, and oil prices are easing Wednesday as
hopes build that the war with Iran could end soon. That's even though some of
the signals investors saw as hopeful are already under dispute, and several
prior bouts of optimism in financial markets quickly got undercut by continued,
fierce fighting in the war.
NEW YORK (AP) -- Stocks are rushing higher worldwide, and oil prices are
easing Wednesday as hopes build that the war with Iran could end soon. That's
even though some of the signals investors saw as hopeful are already under
dispute, and several prior bouts of optimism in financial markets quickly got
undercut by continued, fierce fighting in the war.
The S&P 500 rallied 1.1% and added to its leap from the day before, which
was its best since last spring. That followed even bigger gains for stock
markets across Europe and Asia, including an 8.4% surge in South Korea, which
were catching up to Wall Street's rally from Tuesday.
The Dow Jones Industrial Average was up 401 points, or 0.9%, as of 12:49
p.m. Eastern time, and the Nasdaq composite was 1.7% higher.
Oil prices also fell back toward $100 per barrel after President Donald
Trump said late Tuesday that the U.S. military could end its offensive in two
to three weeks.
That added to optimism following a couple tenuous signals of hope from
earlier Tuesday that Wall Street latched onto, including a news report quoting
Iran's president as saying that it has "the necessary will to end the war" as
long as certain requirements are met, including "guarantees to prevent a
recurrence of aggression."
The worry on Wall Street has been that the war may last a long time and keep
oil and natural gas from the Persian Gulf out of global markets, which could
create a brutal blast of inflation.
But hope has been quick to reverse to doubt on Wall Street, triggering manic
swings back and forth for financial markets since the war with Iran began.
Trump has also made statements that lifted markets, only to see the gains
quickly disappear after increasing his military threats.
Shortly before Wall Street began trading on Wednesday, Trump claimed in a
post on his social media network that Iran "has just asked the United States of
America for a CEASEFIRE!"
"We will consider when Hormuz Strait is open, free, and clear. Until then,
we are blasting Iran into oblivion or, as they say, back to the Stone Ages!!!"
But Iran's Foreign Ministry spokesman, Esmail Baghaei, quickly called that
claim "false and baseless," according to a report on Iranian state television.
Oil prices also remain high, even if they've eased recently. The price for a
barrel of Brent crude oil, the international standard, was sitting at $101.97
following its declines, which is still up from roughly $70 before the war began.
U.S. gasoline prices rose again overnight to a national average of $4.06 per
gallon, according to the auto club AAA.
Iran, meanwhile, hit an oil tanker off the coast of Qatar and Kuwait's
airport on Wednesday while airstrikes battered Tehran as the fighting
continued. Iran also continues to hold a grip on the Strait of Hormuz, where a
fifth of the world's traded oil passes during peacetime.
"De-escalation hopes have given markets a lift, but we think the effects of
the war would, in many cases, persist even if the war did end soon," Thomas
Mathews, head of markets, Asia Pacific at Capital Economics, said in a research
note Wednesday.
"It's worth thinking through how markets might fare if the war were to end
'very soon,'" he wrote. "Do markets have further to recover if sentiment
continues to improve? The answer is almost certainly yes."
The White House said Trump will deliver a public address Wednesday evening
on the Iran war.
On Wall Street, most stocks rose as Big Tech powered the move higher. Gains
of 4.1% for Alphabet and 1.3% for Nvidia were two of the strongest forces
lifting the S&P 500.
Eli Lilly climbed 4.5% after U.S. regulators approved its GLP-1 pill for
weight loss.
Such gains have pulled the S&P 500, which sits at the heart of many 401(k)
accounts, back to within 5.4% of its all-time high set early this year. Just on
Monday, the index briefly neared a 10% drop from its record, a steep-enough
fall that professional investors have a name for it: a "correction."
Nike sank 14.3% even though it reported a stronger profit for the latest
quarter than expected. Analysts said it gave some lackluster financial
forecasts.
Hasbro fell 4.5% after the toy company found someone had gained unauthorized
access to its computer network and is working to assess the full impact.
In stock markets abroad, indexes leaped more than 2% in France and Germany.
Asian markets had even bigger gains.
Tokyo's Nikkei 225 jumped 5.2% after a survey showed business sentiment for
major Japanese manufacturers improved despite worries about the Iran war.
In the bond market, Treasury yields held relatively steady after a report
said U.S. retailers made more money in February than economists expected. A
separate report said U.S. manufacturing growth last month was slightly faster
than economists expected.
The 10-year Treasury yield held at 4.30%, where it was late Tuesday.
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