Stocks leap worldwide, and oil prices drop after the US and Iran reach a
tentative deal on their war
[June 16, 2026] By
STAN CHOE
NEW YORK (AP) — Stock markets rallied worldwide Monday, and oil prices
eased after the United States and Iran reached a tentative deal to
extend their ceasefire and reopen the Strait of Hormuz to get the global
flow of crude going again.
The S&P 500 rose 1.7% on hopes that this time, the announcement of an
Iran-U.S. agreement will mean a long-term fix to a conflict that has
worsened inflation around the world. The Dow Jones Industrial Average
climbed 468 points, or 0.9%, to a record, and the Nasdaq composite
jumped 3.1%.
Stocks got a lift after the price for a barrel of Brent crude oil fell
4.8% to $83.17, back to where it was in early March. While that’s still
above its price of roughly $70 from before the war, it’s lower than the
$100 plus it cost just a few weeks ago. The hope is that lower oil
prices will take pressure off households and businesses, which have had
to pay higher prices for everything from food to fuel to fertilizer
because of the war with Iran.
Iran confirmed the deal, but it does not include a final agreement on
issues like Iran’s nuclear program. Negotiations on that are expected to
continue over the next 60 days, which leaves opportunity for hiccups
that could derail the agreement. And even if the Strait of Hormuz does
fully reopen on Friday as expected, it will likely take months for the
energy industry to get back to full speed.
For now, though, relief swept through financial markets worldwide.
On Wall Street, stocks of companies with big fuel bills were instant
winners. United Airlines flew 3.9% higher, and cruise operator Royal
Caribbean Group rose 6.6%.
Stocks of companies enmeshed in the artificial-intelligence industry
also jumped. These stocks have yo-yoed in recent weeks, going from
roaring to records to suddenly turning lower. The concern is whether
such stocks shot too high, too fast because of AI mania, and their
careening moves have sometimes reversed direction by the hour.
Micron Technology rallied 10.8%, and Advanced Micro Devices rose 7%.
Nvidia’s climb of 3.5% was the strongest force pushing the S&P 500
upward because the AI chip company is Wall Street’s most valuable
company, giving it more weight on the index than any other.
SpaceX, Elon Musk’s rocket company that also owns the AI company xAI,
rose 19.6% in its second day of trading on Wall Street. Its successful
debut on the Nasdaq suggested plenty of demand still exists among
investors for AI. The market has given SpaceX a total value of more than
$2.1 trillion, making it bigger than Exxon Mobil, Bank of America and
Coca-Cola combined.
In the bond market, Treasury yields eased on hopes that lower oil prices
will remove pressure on central banks to raise interest rates.
The yield on the 10-year Treasury slipped to 4.47% from 4.48% late
Friday.
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Trader Daniel Kryger, left, works on the floor of the New York Stock
Exchange, Monday, June 15, 2026. (AP Photo/Richard Drew)
 Europe’s central bank last week
became the first major one in the world to raise interest rates
because of the war with Iran. High interest rates can keep a lid on
inflation, but they also slow economies and undercut prices for all
kinds of investments, including stocks and cryptocurrencies. They
hit investments seen as the most expensive in particular, and some
critics are calling the AI industry a bubble where investment
inflated too far.
The Fed will announce its latest decision on
interest rates later this week, which will be the first under its
new chair, Kevin Warsh. Traders see it as a near certainty that the
Fed will leave its main interest rate steady after its two-day
meeting ends Wednesday.
Traders had been raising bets that the Fed may have to raise
interest rates this year because of how much inflation has
accelerated and how solid the U.S. job market remains. But the
tentative deal between the United States and Iran means traders are
now betting on only a 57% chance of a hike this year, down from 71%
a week ago, according to data from CME Group.
Elsewhere on Wall Street, Roku fell 1.9% after the company announced
that Fox Corp. is buying the streaming pioneer in a cash-and-stock
deal valued at approximately $22 billion.
Roku’s stock had already soared 20% Friday, when media reports
emerged about a deal, which will give Fox access to the Roku
channel, first-party data and more than 100 million global streaming
households. Fox’s stock fell 16.8%.
All told, the S&P 500 rose 122.83 points to 7,554.29. The Dow Jones
Industrial Average climbed 468.77 to 51,671.03, and the Nasdaq
composite jumped 795.10 to 26,683.94.
In stock markets abroad, indexes climbed in Asia and Europe. Japan’s
Nikkei 225 leaped 5% for one of the world’s biggest gains and
finished at a record.
“This is great news,” said Takashi Hiroki, chief strategist at Monex.
“Buying by foreign investors is leading the market with expectations
of easing tensions around the situation in the Middle East.”
South Korea’s Kospi soared even more, 5.2%, thanks in part to
continued rallies for AI winners like Samsung Electronics.
London’s FTSE 100 was an outlier and slipped 0.4%.
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AP Business Writers Matt Ott and Elaine Kurtenbach and Senior
Producer Mayuko Ono contributed to this report.
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