United States equities extended their relief rally on Thursday (Friday AEST) as investors remained hopeful that a fragile ceasefire between the United States and Iran would hold, even as oil prices continued to climb.
The Dow Jones Industrial Average rose 275.9 points, or 0.6%, to close at 48,185.8, while the S&P 500 gained 41.9 points, also 0.6%, to finish at 6,824.7. The tech-heavy Nasdaq Composite outperformed, advancing 187.4 points, or 0.8%, to settle at 22,822.4.
Market sentiment remained supported by optimism that the two-week ceasefire agreement could be sustained following five weeks of conflict that disrupted global energy flows and led to the closure of the strategically critical Strait of Hormuz.
Oil prices moved higher during the session, reflecting ongoing supply concerns. West Texas Intermediate crude futures rose more than 3% to settle at US$97.87 per barrel after briefly surpassing the $100 mark, while Brent crude futures climbed over 1% to close at $95.92.
Equities pared some volatility after Benjamin Netanyahu said Israel had agreed to open direct negotiations with Lebanon, signalling a potential easing of regional tensions.
Earlier, Iran’s parliamentary speaker Mohammad Bagher Ghalibaf accused Israel of violating ceasefire terms through continued military actions in Lebanon.
Investor confidence was also buoyed by gains in Meta Platforms, whose shares rose 2.6% after unveiling a new artificial intelligence model.
The latest advance follows a strong rally in the previous session, when all three major indexes surged more than 2%, with the Dow recording its best performance since April 2025 after Donald Trump signalled a softer stance on tariffs.
The ceasefire agreement was initiated earlier in the week after Trump agreed to pause attacks on Iran. The deal was contingent on Tehran reopening the Strait of Hormuz, a vital shipping route for global oil supplies. Iran agreed to allow traffic through the waterway for two weeks, provided hostilities cease, although shipping activity has yet to fully recover, with only limited bulk cargo movements reported.
Trump warned that U.S. military forces would remain positioned in the region until Iran fully complies with the agreement, adding that any breach would prompt a significant military response.
On the corporate front, Constellation Brands surged 8.5% after reporting a smaller-than-expected decline in fourth-quarter sales.
In contrast, Applied Digital fell 8% after posting a wider third-quarter net loss compared with the previous year.
Economic data released by the U.S. Commerce Department showed that gross domestic product (GDP) growth slowed more than expected in the fourth quarter, while the personal consumption expenditures index remained elevated.
On the bond markets, yields were relatively stable, with the 10-year Treasury yield at 4.283% and the 2-year yield at 3.779%, both little changed on the day.
