Stocks rise on U.S.-Iran peace deal hopes, SpaceX IPO looms
U.S. futures climbed as traders priced in a possible Iran deal that could reopen the Strait of Hormuz, while SpaceX’s $75 billion debut kept risk appetite alive.
Stocks pushed higher as investors latched onto a fragile but market-moving possibility: a U.S.-Iran peace deal that could ease sanctions, reopen the Strait of Hormuz and pull a major geopolitical risk premium out of oil. The rally was broad enough to lift not just U.S. futures but also major benchmarks in Asia and Europe, even as traders remained focused on whether the latest optimism reflected substance or simply hope.
S&P 500 futures rose about 0.6%, Nasdaq-100 futures advanced and Dow futures gained 363 points, or 0.7%. In overseas trading, Japan’s Nikkei 225, India’s Nifty 50, South Korea’s Kospi, the Shanghai Composite and Europe’s Stoxx 600 all moved higher as the headline flow improved sentiment across risk assets. Brent crude futures fell to $88.15 a barrel, a two-month low, after Iranian state media said a draft memorandum of understanding would include a U.S. commitment to lift oil sanctions and an Iranian commitment to reopen the Strait of Hormuz.
The latest move followed Thursday’s rally after President Donald Trump signaled that a deal was near. Bloomberg said the agreement could be signed in Switzerland as soon as Sunday, adding urgency to a market that has spent weeks pricing in the strain of a three-month-old war that had already pushed energy prices sharply higher. If the pact is confirmed, it would amount to the most significant diplomatic breakthrough yet in a conflict that has been feeding volatility in oil, currencies and global equities.
At the same time, traders were bracing for another kind of market test: SpaceX’s debut on the Nasdaq. Elon Musk’s rocket maker is set to list under ticker SPCX at a fixed price of $135 per share, implying a valuation of $1.77 trillion. The company plans to sell 555.6 million shares in a $75 billion fundraise, which would make it the largest initial public offering in history, surpassing Alibaba’s $22 billion offering in 2014.
The size of the deal is why investors are already treating SpaceX as more than a stock-market milestone. A large retail allocation could draw in speculative money but also force some buyers to sell other holdings to participate, creating short-term turbulence. Douglas Beath of Wells Fargo Investment Institute warned that the sheer size could create market “indigestion,” a warning that lands at a moment when geopolitics and the upcoming midterm elections could make markets choppier later in the year.
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