NEW YORK: Wall Street stocks rose sharply over the week and oil prices fell as a fragile truce was struck between the United States and Iran, with ceasefire talks due to start in Islamabad on Saturday (Apr 11).
For the week, all three major US indices advanced by more than three per cent. Oil prices retreated once again on Friday. For the week, they tumbled by approximately 13 per cent.
The New York Stock Exchange closed mixed for the day Friday – the Dow Jones shed 0.6 per cent, the Nasdaq gained 0.4 per cent, and the broader S&P 500 index was flat, slipping 0.1 per cent.
“Markets are trading on a cautious tone ahead of the US-Iran ceasefire talks,” Elias Haddad of Brown Brothers Harriman (BBH) said in a note.
“For financial markets, the key issue is whether peak shipping security fear is now behind us.”
Official sources say the talks in Islamabad will cover Iran’s nuclear enrichment and the free flow of oil through the Strait of Hormuz.
Since the ceasefire took effect, US President Donald Trump has voiced displeasure at Iran’s handling of the strategic strait, which was meant to be reopened.
“The key issue for the oil market is whether ship traffic through the Strait of Hormuz will resume,” Carsten Fritsch of Commerzbank said in a note. “So far, there are no signs of this happening.”
Inflation in the United States rose sharply in March, government data showed Friday, as higher energy prices due to the war hit Americans hard. Prices rose 3.3 per cent from a year earlier.
White House spokesperson Kush Desai responded by saying the US economy “remains on a solid trajectory.”