Oil Prices Plunge as Global Stocks Surge on Ceasefire Hopes/ Newslooks/ WASHINGTON/ J. Mansour/ Morning Edition/ Oil prices dropped sharply and global stock markets surged Tuesday after hopes grew that a ceasefire between Israel and Iran would hold. The S&P 500 moved closer to its all-time high, boosted by easing inflation fears and potential Fed rate cuts. Investors cheered falling energy costs and global market stability.
Oil Prices Plunge as Global Stocks Surge on Ceasefire Hopes: Quick Looks
- S&P 500 climbs 0.7%, nearing its all-time high
- Dow Jones rises 277 points; Nasdaq gains 1%
- U.S. crude falls 4.5% to $65.43; Brent down to $67.35
- Markets react to Trump’s confirmation that Israel-Iran ceasefire is in effect
- Oil prices drop below pre-conflict levels; pressure on inflation eases
- Fed rate cut talk intensifies as two Trump appointees suggest action next month
- Fed Chair Powell urges caution, saying more data is needed
- Cruise stocks soar: Carnival up 9.4%, Norwegian 6%, United Airlines 4.2%
- Global markets rally: France, Germany, Japan, Hong Kong, and South Korea post strong gains
Oil Prices Plunge as Global Stocks Surge on Ceasefire Hopes
Deep Look
New York, NY — June 24, 2025
Wall Street extended its summer rally on Tuesday as oil prices tumbled and optimism returned to global markets following President Donald Trump’s announcement that a ceasefire between Israel and Iran is officially in effect.
Stocks Rebound as Conflict Cools
The S&P 500 rose 0.7% in early trading, closing in on its February all-time high. The Dow Jones Industrial Average was up 277 points, or 0.7%, while the tech-heavy Nasdaq jumped 1%. This surge followed a similar global trend, with major indexes across Europe and Asia registering gains of 1% or more.
Oil Prices Dive
The most dramatic market movement came in the oil sector. Benchmark U.S. crude prices dropped 4.5% to $65.43 per barrel, while Brent crude, the international standard, also slid 4.5% to $67.35. These are the lowest prices seen since before tensions erupted between Iran and Israel nearly two weeks ago.
Markets have been gripped by fears that the conflict might disrupt oil supplies, particularly through the vital Strait of Hormuz. But Monday’s limited Iranian retaliation and Tuesday’s affirmation of the ceasefire by Trump helped ease those concerns.
Inflation Relief and Fed Speculation
The sharp decline in oil prices is welcome news for economists watching inflation. Cheaper fuel costs could bring down overall price pressure, giving the Federal Reserve potential room to cut interest rates.
Two of Trump’s appointees to the Fed have recently suggested that rate cuts may be considered as early as next month. President Trump has been vocal in demanding more aggressive rate reductions to stimulate growth.
However, Fed Chair Jerome Powell remains cautious. In prepared remarks for a Congressional hearing Tuesday, Powell reiterated the central bank’s “wait and see” approach, emphasizing the need for more economic data before changing policy.
Bond Market Reaction
Treasury yields showed little movement amid mixed signals from the Fed. The 10-year yield nudged up to 4.35%, while the 2-year yield edged to 3.85%, reflecting modest adjustments in expectations for future Fed moves.
Cruise and Travel Stocks Soar
Travel-related companies led the market rally, especially those that benefit from lower fuel costs. Carnival Corp. surged 9.4% after beating earnings expectations and raising full-year guidance. Norwegian Cruise Line jumped 6%, while United Airlines and Delta Air Lines gained 4.2% and 3.7% respectively.
Carnival’s CEO, Josh Weinstein, cited strong late bookings and onboard spending as signs of continued demand, particularly among vacationers eager to travel after months of economic uncertainty.
Global Rally in Full Swing
Investor confidence wasn’t limited to the U.S. Major indexes in Europe and Asia rallied strongly. France’s CAC 40 and Germany’s DAX posted gains above 1%, while Japan’s Nikkei rose sharply. Hong Kong’s Hang Seng jumped 2.1%, and South Korea’s Kospi surged 3%, marking some of the largest single-day moves this month.
This widespread optimism followed Trump’s statement late Monday that Israel and Iran had agreed to a “complete and total ceasefire,” quelling concerns about a broader regional conflict that could have derailed global recovery efforts.
What’s Next?
Markets are now watching to see if the ceasefire holds and whether the Fed will act on growing pressure to cut rates. A stable geopolitical outlook combined with falling oil prices and contained inflation could create the perfect setup for another record-breaking stretch on Wall Street.
