US sharemarkets rose on Monday, with all three major indices closing higher as investors responded to renewed signals that negotiations between the United States and Iran could resume. The S&P 500 gained 1.02% to 6,886.24, its highest close since before the war began. The Nasdaq Composite advanced 1.23% to 23,183.74, while the Dow Jones Industrial Average added 301.68 points, or 0.63%, to 48,218.25.
The Dow recovered from an earlier decline of more than 400 points, while both the S&P 500 and Nasdaq moved higher after trading in negative territory earlier in the session. Technology stocks led the rebound, with Oracle rising nearly 13% and Palantir Technologies gaining more than 3%, helping the S&P 500 erase losses recorded since the start of the conflict.
Markets moved higher after Donald Trump said the United States had been contacted by Iran regarding a potential deal. The comments came despite the implementation of a naval blockade of the Strait of Hormuz, announced after talks in Islamabad ended without agreement.
Oil and macro
Oil prices remained elevated, reflecting ongoing concerns about supply disruptions. West Texas Intermediate crude rose 2.6% to settle at US$99.08 a barrel, while Brent crude gained 4.37% to US$99.36.
The blockade targets maritime traffic to and from Iranian ports, though vessels bound for non-Iranian destinations are still permitted to transit the Strait. The breakdown in negotiations has reinforced uncertainty around the duration of the war and its potential impact on global energy markets.
Diplomatic efforts are continuing, with mediators from Pakistan, Egypt and Turkey expected to facilitate further discussions in coming days. However, positions remain far apart, with Iran reportedly seeking control of the Strait, reparations and the release of frozen assets.
Market participants are also assessing the broader macro impact, with asset managers including BlackRock upgrading their outlook for US equities, citing resilient earnings and a contained economic effect from the conflict.
Australian Market Outlook
Australian shares are set to open higher, tracking gains on Wall Street after comments suggesting negotiations may resume. S&P/ASX 200 futures are up 119 points, or 1.3%, to 9,069.
Locally, investors will be monitoring corporate and economic updates. Fineos is scheduled to hold its AGM, while NAB business conditions and Westpac consumer confidence data are due. Reserve Bank of Australia deputy governor Andrew Hauser is also set to speak in New York.
