Major United States benchmark indices closed mixed on Wednesday (Thursday AEST), with the S&P 500 and Nasdaq Composite posting fresh record highs as investors looked past ongoing Iran war concerns and focused on the prospect of a diplomatic resolution.
The Dow Jones Industrial Average slipped 72.3 points, or 0.2%, to 48,463.7. In contrast, the S&P 500 rose 55.6 points, or 0.8%, to close at a record 7,023.0, while the Nasdaq Composite surged 376.9 points, or 1.6%, to 24,016.0, also marking a new all-time high.
Investor sentiment has been buoyed throughout the week by optimism that a peace agreement between the United States and Iran could be within reach. The S&P 500, which fully recovered its losses linked to the Iran conflict earlier in the week, has climbed 3% so far. The Nasdaq has gained nearly 5%, while the Dow has added more than 1% week-to-date.
Reports indicate that a second round of negotiations between Washington and Tehran is under discussion, although no formal schedule has been confirmed.
White House Press Secretary Karoline Leavitt told reporters that discussions surrounding a second round of talks with Iran were ongoing and productive.
However, she dismissed reports suggesting the United States had requested a ceasefire. At the same time, the U.S. Department of the Treasury announced fresh sanctions targeting Iran’s oil transportation infrastructure, affecting more than two dozen individuals, companies, and vessels.
ANZ analysts noted in a client update: "Mediators are said to be pushing for a compromise on outstanding issues including the reopening of the Strait of Hormuz and Iran’s nuclear enrichment program. Trump also downplayed the prospect of renewed fighting, saying that the near seven-week conflict is “close to over”.
"Nevertheless, the effects of disruptions to global oil supply continue to surface. The Energy Information Administration reported widespread inventory drawdowns in its latest weekly data.
"Commercial crude oil inventories fell by 913kbbl last week, while gasoline stockpiles declined by 6,328kbbl and distillate fuel oil inventories dropped by 3,122kbbl.
"Strong demand also drove U.S. exports of crude oil and refined products to record levels."
Corporate earnings provided additional support to markets. Shares of Bank of America rose 1.8% after the lender reported growth in first-quarter profit.
Meanwhile, Morgan Stanley rallied 4.5% after posting a jump in quarterly earnings.
Technology and emerging sectors also saw notable gains. Quantum computing stocks extended their rally, with Rigetti Computing jumping 13.3%, D-Wave Quantum surging 22.6%, and Arqit Quantum climbing over 16%.
Broadcom was among the standout performers, advancing 4.2% after Meta Platforms extended its partnership with the chipmaker to deploy custom chips using its technology.
Elsewhere, Snap shares gained 7.9% after announcing plans to lay off approximately 1,000 employees.
Footwear company Allbirds posted an extraordinary 582.3% surge after revealing a strategic pivot towards AI infrastructure.
On the bond markets, yields moved higher, with the 10-year Treasury yield rising 0.8% to 4.281%, while the 2-year yield increased 0.4% to 3.761%.
