Dow jumps nearly 800 points after Trump calls off Iran strikes, chip stocks rebound

• Oil prices fell sharply with Brent crude down 2.7% to $90.61 per barrel and WTI down 2.4% to $87.91, while gasoline prices remained nearly 40% higher than pre-war levels at $4.13 per gallon
• Chip stocks led the recovery with Micron Technology up 7.2%, Intel up 6.8%, and AMD up 5.6% as markets prepared for major AI IPOs including SpaceX targeting a $1.75 trillion valuation
• The peace agreement was approved by the US, Israel, Saudi Arabia, UAE, Qatar, Turkey, Pakistan, Bahrain, Kuwait, Jordan, Egypt and others, easing geopolitical tensions that had rattled markets

Market Summary: Dow Surges 782 Points on Iran De-escalation, Tech Stocks Rebound

Key Market Movements:

U.S. stocks rallied sharply Thursday afternoon, with the Dow Jones Industrial Average climbing 782 points (1.6%), while the S&P 500 and Nasdaq gained 1.2% and 1.6% respectively by 2:40 p.m. ET.

Geopolitical Catalyst:

President Trump announced the cancellation of planned military strikes against Iran via Truth Social at 1:28 p.m. ET, citing high-level diplomatic discussions approved by multiple parties including the U.S., Israel, Saudi Arabia, UAE, and others. Trump indicated an agreement to reopen the Strait of Hormuz and begin nuclear negotiations is "pretty much all wrapped up."

Energy Markets:

Oil prices retreated on the news, with Brent crude falling 2.7% to $90.61 per barrel and West Texas Intermediate declining 2.4% to $87.91. National average gasoline prices reached $4.13 per gallon, down from the prior week but still approximately 40% above pre-war levels.

Sector Performance:

Chip stocks led the recovery after weeks of declines: Micron Technology surged 7.2%, Intel rose 6.8%, and Advanced Micro Devices gained 5.6%. The sector rebounded ahead of anticipated major AI IPOs, including a rocket-launch firm targeting a $1.75 trillion valuation that could make Elon Musk the world's first trillionaire.

Economic Data:

The Producer Price Index showed the largest increase since November 2022, dampening expectations for near-term interest rate cuts.

Notable Earnings:

Oracle shares declined despite beating earnings estimates, as investors reacted negatively to plans for an additional $20 billion in spending amid negative free cash flow for the year.