Dow jumps nearly 375 points while oil tumbles 7%
U.S. stocks climbed Monday as investors welcomed Iran’s restrained response to American airstrikes over the weekend. Meanwhile, crude oil prices plunged more than 7%, easing fears of a supply shock in global energy markets.
The Dow Jones Industrial Average closed up 374.96 points, or 0.89%, at 42,581.78. The S&P 500 rose 0.96% to 6,025.17, while the Nasdaq Composite added 0.94%, ending the session at 19,630.97.
Oil slumps as supply fears fade
Iran said Monday it had launched a missile strike on a U.S. base in Qatar in retaliation for American attacks on its nuclear sites in Fordo, Isfahan, and Natanz. However, Qatar reportedly intercepted the strike, and no casualties were reported, triggering a sharp sell-off in oil.
West Texas Intermediate crude futures dropped over 7%, settling at $68.51 per barrel after briefly touching $78 overnight. The move came as traders bet that oil supply would remain largely unaffected by the conflict escalation.
President Donald Trump further pressured oil markets, stating on Truth Social that “everyone” should keep oil prices low to avoid “playing into the hands of the enemy.”
Market outlook stabilizes
“Markets only care about oil supply shocks,” said Jamie Cox of Harris Financial Group. “As long as they stay at bay, we’ll see markets sharply higher.” Cox added that the U.S. strikes may have significantly degraded Iran’s nuclear capabilities.
Despite the geopolitical risks, analysts expressed cautious optimism. Adam Crisafulli of Vital Knowledge noted that investors view Iran’s limited options and the abundance of global oil supply as reasons to stay calm. “Tehran’s relative isolation and degraded military capacity suggest limited escalation risk,” he said.
Still, uncertainty remains. U.S. Secretary of State Marco Rubio urged China—Iran’s top oil customer—to help prevent any potential closure of the Strait of Hormuz, a critical global oil chokepoint.