US stocks moved higher Tuesday, while oil prices declined for a second consecutive day, as investors reacted to signs that a ceasefire between Israel and Iran may hold, CNBC reports.
The Dow Jones Industrial Average rose by 406 points, or 0.9%, supported by gains in sectors sensitive to fuel prices. The S&P 500 also climbed 0.9%, while the Nasdaq Composite led the way with a 1.3% gain, buoyed by strength in technology shares.
Oil prices, which had already fallen more than 7% on Monday, continued their slide. US crude dropped more than 5%, and global benchmark Brent crude fell over 4%, as geopolitical tensions in the Middle East appeared to ease slightly. President Donald Trump stated on social media that “ISRAEL is not going to attack Iran,” suggesting that the fragile ceasefire reached early Tuesday morning remains in effect, despite ongoing accusations from both sides of violations.
The decline in oil prices lifted airline stocks, with shares of United Airlines, Delta, and Frontier all rising over 2%. Investors also showed a renewed appetite for risk, helping tech stocks such as Nvidia and Broadcom advance 2% and 3%, respectively.
Economic sentiment was further shaped by Federal Reserve Chair Jerome Powell’s testimony before Congress. Powell reiterated that the Fed is not in a hurry to adjust interest rates, citing ongoing uncertainty surrounding the impact of recent US tariffs and the broader geopolitical climate.
“We are well positioned to wait,” Powell told lawmakers, emphasizing the central bank’s commitment to its dual mandate of stable prices and full employment. Inflation remains above the Fed’s 2% target, and the central bank has signaled a cautious approach until more data is available.
Other Fed officials echoed that stance. New York Fed President John Williams called the current monetary policy “entirely appropriate,” adding that inflation is expected to ease to 3% this year, while growth slows to around 1%.
Despite the broader calm, precious metals ETFs such as the VanEck Gold Miners ETF (GDX) and the Global X Silver Miners ETF (SIL) pulled back, reflecting reduced demand for traditional safe-haven assets.
Meanwhile, Microsoft and JPMorgan Chase both hit record highs, reflecting investor confidence in blue-chip stocks. Microsoft’s gains extended its positive streak to five of the last six sessions, while JPMorgan is now up more than 17% year-to-date.
Cruise line stocks also rallied following Carnival’s stronger-than-expected earnings report. The company raised its full-year forecast, citing robust demand despite global uncertainty. Carnival shares jumped 8%, with Royal Caribbean and Norwegian Cruise Line also gaining.
In the background, Trump’s comments about allowing China to buy oil from Iran added another dimension to oil market dynamics. This potential easing of sanctions signaled a shift in the US approach to Iran, contributing to the latest drop in crude prices.
