Global stocks surge as peace deal hopes ease market fears

The S&P 500 followed world shares higher and crude prices retreated yesterday as investors neared the end of a holiday-shortened week with renewed hopes of progress towards a peaceful resolution to the Iran war.

The Dow joined the S&P 500 in positive territory while the tech-heavy Nasdaq was essentially unchanged, and US Treasury yields dipped as markets prepared to turn the page on a week and month marked by a tug-of-war between fears that air strikes could shatter a fragile truce and signs that Washington and Tehran are moving closer to the negotiating table.

The S&P 500 is poised to notch its ninth straight weekly gain, its longest winning streak since the one that ended in December 2023.

All three indexes are set to register monthly advances.

The Dow Jones Industrial Average rose 218.86 points, or 0.43 per cent, to 50,888.48, the S&P 500 rose 9.06 points, or 0.12pc, to 7,572.73 and the Nasdaq Composite fell 2.43 points, or 0.01pc, to 26,915.85.

European shares gained ground, and were on track to log monthly gains as a potential deal to extend the ceasefire and reopen the Strait of Hormuz supported investor sentiment.

MSCI’s gauge of stocks across the globe rose 4.36 points, or 0.40pc, to 1,129.27.

The pan-European STOXX 600 index rose 0.25pc, while Europe’s broad FTSEurofirst 300 index rose 6.02 points, or 0.24pc.

Emerging market stocks rose 26.16 points, or 1.51pc, to 1,750.80.

Brent crude oil prices eased as the market awaited confirmation that the United States and Iran have extended their truce.

US crude fell 0.1pc to $88.80 a barrel and Brent fell to $92.48 per barrel, down 1.31pc on the day.

Treasury yields were headed lower for the fourth straight session, closing out a week in which reported progress in US-Iran peace negotiations fuelled market optimism.

The yield on benchmark US 10-year notes fell 0.6 basis points to 4.451pc, from 4.455pc late on Thursday. The 30-year bond yield fell 0.1 basis points to 4.9837pc from 4.985pc late on Thursday.

The 2-year note yield, which typically moves in step with interest rate expectations for the Federal Reserve, fell 0.9 basis points to 4.016pc, from 4.025pc late on Thursday.

The dollar inched higher but remained on course for a small weekly loss amid fluctuating hopes for a near-term resolution to the Middle East conflict.

The dollar index, which measures the greenback against a basket of currencies including the yen and the euro, rose 0.05pc to 99.04, with the euro down 0.04pc at $1.1645.

Against the Japanese yen, the dollar strengthened 0.05pc to 159.32.

In cryptocurrencies, bitcoin fell 1.16pc to $72,618.43. Ethereum declined 1.21pc to $1,986.70.

Gold got a boost from ceasefire optimism but remained on course for a monthly drop.

Spot gold rose 1.03pc to $4,537.99 an ounce. US gold futures rose 0.74pc to $4,532.40 an ounce.