US industrial stocks hit all-time highs after the US and Iran announced an interim framework agreement that, if it holds, would effectively defuse the most dangerous geopolitical flashpoint markets have dealt with in years.
The deal, announced on June 14, calls for reopening the Strait of Hormuz to commercial shipping, lifting the US naval blockade, and extending the existing ceasefire by 60 days to allow further negotiations over Iran’s nuclear program. A formal signing is scheduled for June 19 in Switzerland.
Markets exhale
Oil prices fell more than 5%, settling around $80 per barrel, as traders priced in the restoration of one of the world’s most critical shipping lanes. The Strait of Hormuz handles roughly a fifth of the world’s oil supply on any given day.
US stock futures climbed in early trading. The Dow rose 1.0%, the S&P 500 gained 1.2%, and the Nasdaq 100 led the pack with a 1.9% increase. Industrial shares, the sector most directly exposed to energy costs and global supply chain stability, pushed to record levels.
