Stocks Surge as U.S.-Iran Peace Deal Sends Oil Lower and Tech Higher

The stock market kicked off the holiday-shortened week with a powerful rally as falling oil prices and easing geopolitical tensions fueled broad-based buying. The S&P 500 climbed 1.6%, the Nasdaq Composite surged 2.9%, and the Dow Jones Industrial Average gained 1.0%, with the Dow reaching fresh record highs. After a strong opening move, the major averages traded in a relatively tight range for the remainder of the session, holding on to their gains throughout the day.

Investor sentiment received a major boost following President Trump’s announcement that the United States and Iran have reached a peace agreement that includes reopening the Strait of Hormuz and ending Iran’s naval blockade. While negotiations surrounding Iran’s nuclear program remain unresolved, markets focused on the progress toward de-escalation and the prospect of improved global energy flows. The agreement is expected to be formally signed in Switzerland later this week.

The geopolitical breakthrough triggered another sharp decline in energy prices. WTI crude oil futures fell 4.7% to settle at $80.90 per barrel, helping ease concerns about inflationary pressures and global economic growth.

Technology stocks led the advance as investors returned aggressively to growth-oriented sectors following last week’s volatility. The information technology sector rose 3.4%, making it the best-performing area of the market. Semiconductor shares were particularly strong, with the Philadelphia Semiconductor Index gaining 5.5%.

NVIDIA moved back above its 50-day moving average, while memory-related companies delivered some of the session’s strongest performances. Western Digital, Micron, and Seagate Technology all posted substantial gains as investors renewed their enthusiasm for AI infrastructure and data storage themes.

Mega-cap technology and internet companies also participated in the rally. Meta Platforms and Amazon were among the session’s top performers, helping drive gains in both the communication services and consumer discretionary sectors. The Vanguard Mega Cap Growth ETF advanced 2.8%, reflecting the broad strength across large-cap growth stocks.

SpaceX remained a major focus for investors following its highly successful IPO. Shares surged nearly 20% in their second trading session, leaving the stock roughly 40% above its offering price and reinforcing investor enthusiasm for high-growth technology and aerospace companies.

Beyond the technology sector, lower oil prices provided support for a variety of economically sensitive industries. Travel-related stocks performed particularly well, with cruise operators and other leisure companies benefiting from reduced fuel cost concerns. DoorDash was among the standout performers within the S&P 500.

Industrials also posted strong gains, supported by advances in airline stocks and electrical equipment manufacturers, many of which continue to benefit from growing investment tied to artificial intelligence infrastructure.

The day’s clear laggard was the energy sector, which fell 3.6% as oil prices retreated sharply. Defensive sectors also underperformed as investors shifted toward higher-growth opportunities. Real estate, health care, and consumer staples all finished lower as capital rotated away from traditionally defensive areas of the market.

Overall, the session was relatively calm following the opening surge, with a lack of major corporate headlines allowing investors to focus primarily on the improving geopolitical backdrop. Falling oil prices, easing inflation concerns, and renewed strength across mega-cap technology stocks combined to create a highly constructive environment for equities. After a volatile finish to the previous week, growth stocks reestablished leadership and helped propel the broader market sharply higher to begin the new week.

Our FTinvest 11 model portfolio gained 0.67% to close at 987.93, recovering a portion of the previous session’s losses. While the portfolio remains below the 1,000 level, the rebound suggests some stabilization after a period of heightened volatility.

FTinvest 11 is now up approximately +6.44% year-to-date. The portfolio remains below its all-time high of 1,078.93, but continues to hold a positive return for 2026 despite recent pressure linked largely to one component facing liquidity-related challenges.