US Stocks Edge Higher as Oil Prices Rise/ Newslooks/ WASHINGTON/ J. Manour/ Morning Edition/ U.S. stocks edged higher Monday as oil prices climbed amid the Iran conflict. Investors remain cautious over inflation risks and potential Federal Reserve action. Global markets showed mixed results as geopolitical tensions drove volatility.
US Stocks Edge Higher Quick Looks
- S&P 500 rises slightly after volatile trading
- Oil prices climb amid Iran war uncertainty
- Dow gains 257 points, Nasdaq dips slightly
- Investors watch Strait of Hormuz disruptions
- Treasury yields ease after recent surge
- Alcoa jumps on supply disruption speculation
- Sysco drops after major acquisition announcement
- Global markets show mixed performance
Deep Look: US Stocks Edge Higher in Shaky Trading as Oil Prices Climb
NEW YORK — U.S. stocks fluctuated Monday as investors weighed rising oil prices and ongoing uncertainty surrounding the conflict with Iran, which continues to influence global markets and inflation expectations.
The S&P 500 edged up 0.2% in afternoon trading following its worst week since the war began. The Dow Jones Industrial Average climbed 257 points, or 0.6%, while the Nasdaq composite slipped 0.1%, highlighting uneven performance across sectors.
Markets initially surged, with the S&P 500 jumping as much as 0.9% early in the day. However, gains quickly faded before stocks stabilized and moved slightly higher later in the session. The volatile movement reflected ongoing investor uncertainty over geopolitical risks and energy prices.
Oil Prices Drive Market Uncertainty
Oil prices continued climbing as investors assessed the impact of the Middle East conflict. Brent crude for June delivery rose 1.6% to $107.01 per barrel, adding to recent increases driven by concerns about supply disruptions.
The main concern for investors remains whether oil and natural gas can flow freely from the Persian Gulf. Disruptions to energy supply could push inflation higher and complicate central bank policies worldwide.
Over the weekend, tensions escalated further when Houthi rebels in Yemen entered the conflict, raising fears that additional shipping routes could be affected. The Strait of Hormuz — a key oil transit route — remains a major focal point for markets.
Trump Comments Add to Market Volatility
Before markets opened Monday, President Donald Trump said on social media that “great progress” was being made toward ending military operations in Iran. The comments initially boosted investor sentiment.
However, Trump also warned that the U.S. could “blow up and completely obliterate” Iranian power plants if negotiations fail and the Strait of Hormuz is not reopened quickly. The mixed messaging mirrored last week’s pattern, where optimism about negotiations was followed by renewed uncertainty.
This back-and-forth has led some investors to give less weight to official statements while focusing more on actual developments in the conflict.
Stocks Look Cheaper After Market Pullback
Despite volatility, some investors see potential buying opportunities. The S&P 500 finished last week 8.7% below its January record high, while both the Dow and Nasdaq remain more than 10% below their peaks — a decline that market professionals classify as a correction.
Strategists at Morgan Stanley noted that valuations appear more attractive. Based on projected earnings growth, the S&P 500 now looks roughly 17% cheaper than before the conflict began.
Analysts led by Michael Wilson said these factors suggest the market correction could be nearing its end, provided the conflict does not trigger a recession or prompt the Federal Reserve to raise interest rates.
Bond Yields Offer Some Relief
Treasury yields, which surged after the conflict began, eased Monday. The yield on the 10-year Treasury fell to 4.33% from 4.44% late Friday.
Although still elevated compared with pre-war levels of 3.97%, the decline offered some relief to equities. Lower yields can support stock valuations and reduce borrowing costs.
The real estate sector particularly benefited from easing yields. Alexandria Real Estate, which owns life-science campuses across the United States, rose 2% as borrowing cost expectations improved.
Company Movers
Some individual stocks made significant moves:
- Alcoa surged 10.1% after speculation that damage to Middle East aluminum facilities could increase demand
- Sysco dropped 14.3% after announcing its acquisition of Jetro Restaurant Depot in a deal valued around $29.1 billion
- Real estate stocks gained as Treasury yields eased
These company-specific moves added to the broader market’s uneven performance.
Global Markets Mixed
International markets showed mixed results. In Europe, stocks posted gains:
- London’s FTSE 100 rose 1.6%
- Paris’ CAC 40 gained 0.9%
However, Asian markets declined sharply:
- Seoul’s Kospi dropped 3%
- Tokyo’s Nikkei 225 fell 2.8%
- Hong Kong’s Hang Seng slipped 0.8%
The divergent performance reflects global uncertainty and regional exposure to energy disruptions.
Inflation and Fed Policy in Focus
The Federal Reserve remains a key factor for investors. Rising oil prices could push inflation higher, potentially forcing the Fed to raise interest rates.
Higher rates would help control inflation but could also slow economic growth and pressure stock valuations. Investors are closely watching energy prices and inflation data for signals about future monetary policy.
As geopolitical tensions persist and oil prices remain elevated, markets are expected to remain volatile. Investors continue balancing potential buying opportunities against risks from inflation, interest rates, and ongoing global conflict.
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