New York stock market rises…Trump's truce announcement·Iran sanctions withdrawal leads to oil price plummet

As Oil Prices Plummet, Warm Wind Blows On US Stock Market (Source: Yonhap News)

With The Ceasefire Between Israel And Iran Taking Effect And Geopolitical Risks Somewhat Eased, The New York Stock Exchange Responded With An Uptrend On The 24th (Local Time). After US President Donald Trump Directly Declared The Ceasefire, He Also Stated That China Would Be Allowed To Import Iranian Crude Oil, And Withdrew The Second Sanctions Against Iran, Which Also Affected The Market Sentiment.

On This Day At The New York Stock Exchange, The Dow Jones Index Rose 432 Points (1.02%) To Reach 43,014, The S&P 500 Index Rose 0.99% To 6,084, And The Nasdaq Index Soared 1.4% To Surpass 19,905. As Geopolitical Tensions Eased, Investors Turned Their Attention Back To Risk Assets, With Buying Activity Concentrated Particularly On Technology And Airline Stocks.

International Oil Prices Also Fell Significantly. West Texas Intermediate (WTI) Fell 4.82% To $65.21 Per Barrel From The Previous Day, While Brent Crude Was Down 5.15% To $66.89. Trump's Statement That “China Can Continue To Import Iranian Crude Oil” De Facto Withdraws The Second Sanctions Warned Last Month, And Is Seen As A Decisive Factor In The Oil Price Drop. Previously, He Had Warned That “Any Country That Buys Iranian Oil Or Petrochemical Products Will Be Subject To Sanctions.”

Airline Stocks, Which Directly Benefitted From The Oil Price Drop, Are Also On The Rise. United Airlines Is Up 1.6%, Delta Is Up 1.8%, And Frontier Is Up 5.7%. Technology Stocks Are Also Strong, With Nvidia Up 1.8% And Broadcom Up 3.7%.

Trump Declared Around 1 AM Through Truth Social, “The Ceasefire Is Now In Effect. Do Not Violate.” Both Iran And Israel Expressed Intent To Accept The Ceasefire. However, Afterward, Iran Fired Missiles And Israel Intercepted Them, So The Unstable Situation Remains. Trump Criticized Both Israel And Iran For Violating The Ceasefire And Urged Israel To Refrain From Military Responses. In The Market, It Is Predicted That The Tension Between The Sides Has Not Been Completely Resolved But The Ceasefire Will Not Be Broken For The Time Being.

Solita Marcelli, CIO Of UBS Global Wealth Management, Said, “The Market Reaction To This Situation Is Consistent With The Prevailing View That Geopolitical Shocks Have A Temporary Impact On Financial Markets,” Adding, “Investors Are Likely To Focus Again On Fundamentals.” She Added, “We Believe That Strong Fundamentals Will Drive The Stock Market Up Over The Next 12 Months.”

Meanwhile, The Market Also Paid Attention To The Remarks By Jerome Powell, Chair Of The Federal Reserve. Powell Stated In His Testimony Before The US House Committee That “The Impact Of Tariffs Depends On The Final Level,” And “It Is More Appropriate To Monitor Economic Data Than To Adjust Policies Hastily.” This Is Interpreted As Reaffirming The Fed's Position Not To Move Hastily Despite Trump's Repeated Pressure For Rate Cuts.

Nonetheless, There Is Still A Possibility Of A Rate Cut In July Within The Fed. Vice Chair Michele Bowman And Director Christopher Waller Have Indicated That They May Support A Rate Cut Next Month If The Trend Of Controlling Inflation Continues.

The US Treasury Market Showed Stability, With The 10-year Yield At 4.3% And The 2-year Yield At 3.82%, Moving At Similar Levels As The Previous Day.