Fragile U.S.-Iran Ceasefire Keeps Stock and Energy Markets On Edge

Barry Adams
29 Jun, 2026
New York City

Wall Street indexes advanced in Monday's trading, and investors reassessed the latest pause in hostilities between the U.S. and Iran. 

Over the weekend, the U.S. and Iran exchanged fire over the Strait of Hormuz that threatened to derail negotiations in search of lasting peace. 

Uncertainty over the Middle East oil supplies through the Strait of Hormuz remained high amid growing skepticism that the U.S. and Iran could agree on a durable peace agreement. 

The U.S. president promised to end the war in the Middle East in less than four weeks, but after four months there are no signs of ending hostilities in the region. 

Moreover, crude oil inventories in China, Japan, and India are running at and approaching historic low levels, raising fears that tighter supply conditions are likely to persist in the second half of this year. 

For now, the U.S. and Iran paused hostilities and allowed commercial ships to sail freely through the narrow passageway on Monday following a weekend of air strikes in southern Iran, Kuwait, and Bahrain. 

AI-related chip stocks rebounded in Monday's trading, and Arm Holdings increased 2.2%, Marvell Technology gained 2.4%, and Intel advanced 1.7%. 

Across the Atlantic, European stock markets traded down in volatile trading as investors sold off defense-related stocks for the second consecutive week. 

In Asia, benchmark indexes in Japan erased most of the session's early losses and, in Hong Kong, gained more than 1.5% in Monday's trading. 

A global rout in technology stocks intensified as the week progressed, but losses were capped following a decline in crude oil prices at the end of last week.

After a week of wild swings, the S&P 500 index decreased 2%, and the Nasdaq Composite declined 4.6%, with Alphabet, Nvidia, Intel, and Broadcom losing between 8% and 11% amid growing concerns over the stretched AI valuations, sustainability of AI infrastructure spending, and lack of earnings visibility for key AI players. 

The weakness in tech stocks dragged down broader indexes in Japan, South Korea, Taiwan, and Europe.