U.S. Stocks surged on Friday as Iran declared the Strait of Hormuz completely open following a ceasefire between Israel and Lebanon, with the Dow Jones Industrial Average jumping 868.71 points to close at 49,447.43.
How the Strait announcement moved markets
The S&P 500 rose 1.2% to 7,126.06, crossing the 7,100 threshold for the first time, while the Nasdaq Composite gained 1.52% to settle at 24,468.48 for its 13th consecutive winning day. Oil prices fell sharply as supply disruption fears eased, with U.S. West Texas Intermediate futures dropping nearly 12% to $83.85 a barrel and Brent crude declining 9% to $90.38 a barrel. Trump thanked Iran for opening the strait in a Truth Social post, saying the U.S. Navy’s blockade of Iranian ports will remain in full force until a peace agreement with Tehran is reached.
For more on this story, see Stocks Fall and Oil Prices Rise as Trump’s Iran Deadline Approaches.
What the reopening means for trade and risk
Iran’s Tasnim news agency reported that ships and cargo linked to hostile nations will not be allowed to move through the strait, and the waterway will be closed if the U.S. Blockade persists. It remains uncertain whether ships will be forced to pay a toll to traverse the waterway. Shares of Boeing and Royal Caribbean advanced 2% and 7% respectively, reflecting renewed confidence in industries vulnerable to strait closures.
This follows our earlier report, Trump and Iran Agree to Two-Week Ceasefire to Reopen Strait of Hormuz.
What does the Strait of Hormuz’s reopening mean for global oil prices?
The reopening reduced fears of supply disruption, leading to a sharp drop in oil prices as markets priced in restored flow through the critical chokepoint.
Why did U.S. Stocks rise despite the ongoing U.S. Blockade of Iranian ports?
Investors focused on the reduced risk of immediate supply disruption from the strait’s reopening, viewing it as a step toward de-escalation that outweighed continued port restrictions.
