Wall Street closed higher on Friday (Saturday AEST), buoyed by optimism surrounding a potential peace agreement between the United States and Iran and a blockbuster market debut from SpaceX, which became the largest public listing in United States history.
The Dow Jones Industrial Average rose 353.5 points, or 0.7%, to finish at 51,202.3. The S&P 500 gained 37.2 points, or 0.5%, to 7,431.5, while the Nasdaq Composite added 79.2 points, or 0.3%, to close at 25,888.8.
The small-cap Russell 2000 advanced 23 points, or 0.8%, to 2,944.0, marking a record closing high.
For the week, all three major indexes posted strong gains of roughly 0.7%.
Investor confidence was supported by signs that a resolution to the conflict between the United States and Iran may be near. A senior U.S. administration official indicated that a draft peace proposal had been agreed upon in principle by both sides.
Over the weekend, reports emerged that the United States and Iran had reached an agreement to end their nearly four-month conflict, with both nations committing to the immediate and permanent cessation of military operations across all fronts, including in Lebanon.
“Following intensive talks, we are pleased to announce that the Peace Deal between the United States of America and Islamic Republic of Iran has been REACHED,” Pakistan Prime Minister Shehbaz Sharif said in a post on X on Sunday.
"The official signing ceremony will be on Friday, 19 June in Switzerland."
The market's primary focus, however, was the highly anticipated debut of SpaceX on the Nasdaq. Shares of Elon Musk's aerospace company began trading on Friday and closed up 19.2% at $160.95, significantly above their initial public offering price of $135.
The strong debut lifted SpaceX's market capitalisation to approximately $2.1 trillion, placing the company among the largest publicly traded corporations in the United States.
Shares of Tesla, another Musk-led company, rose 1.8% as investors continued to back growth-focused technology names.
Attention is also turning to other potential market debuts, with artificial intelligence leaders OpenAI and Anthropic widely expected to pursue public listings later this year.
While SpaceX soared, several space-related stocks that had rallied ahead of the IPO pulled back. Rocket Lab fell 10.8%, Intuitive Machines declined 13.1%, and Planet Labs dropped 8.8% as investors took profits following recent gains.
Markets are now looking ahead to next week's Federal Reserve policy meeting, the first to be held under Chair Kevin Warsh. Investors will closely monitor the central bank's outlook for inflation and interest rates.
According to the CME Group FedWatch Tool, futures markets currently imply a 64.1% probability of a rate increase by December, making any commentary from policymakers particularly significant for equity and bond markets.
Among individual stocks, Adobe fell 6.8% following the departure of Chief Financial Officer Dan Durn, weighing on the software company's shares.
On the bond markets, U.S. Treasury yields moved higher. The benchmark 10-year Treasury yield rose 0.5% to 4.483%, while the two-year Treasury yield increased 0.6% to 4.087%.
