Stocks Close Higher as Trump Declares Iran Response “Weak”, Fed in Focus Tuesday

U.S. markets shrugged off plunging oil prices and fresh geopolitical tensions to close sharply higher on Monday, after President Donald Trump characterized Iran’s missile strike on a U.S. base as “very weak” and investors looked ahead to Tuesday’s testimony from Federal Reserve Chairman Jerome Powell.

The Dow Jones Industrial Average rose 374.96 points, or 0.89%, to 42,581.80. The Nasdaq Composite gained 183.56 points, or 0.94%, to 19,631.00, while the S&P 500 added 57.35 points, or 0.96%, to finish at 6,025.19. The small-cap Russell 2000 led gains, jumping 2.54 points, or 1.21%, to 211.75.

In sharp contrast, crude oil futures collapsed. West Texas Intermediate crude for August delivery settled at $68.76 per barrel, down $5.08, or 6.88%, in one of the largest one-day drops of 2025 so far.

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Trump Declares “No Americans Harmed” in Missile Strike

Market sentiment improved through the afternoon and President Trump issued a pair of posts on Truth Social downplaying Iran’s military response to last weekend’s U.S. airstrikes on Iranian nuclear facilities.

“Iran has officially responded to our Obliteration of their Nuclear Facilities with a very weak response, which we expected, and have very effectively countered,” Trump wrote. “There have been 14 missiles fired — 13 were knocked down, and 1 was ‘set free,’ because it was headed in a nonthreatening direction. I am pleased to report that NO Americans were harmed, and hardly any damage was done.”

He added, “Perhaps Iran can now proceed to Peace and Harmony in the Region, and I will enthusiastically encourage Israel to do the same.”

In a follow-up statement, Trump thanked Qatar’s Emir and emphasized that “no Americans” or “Qataris” were injured in the attack on the Al-Udeid Air Base, which had been preceded by advance warning from Tehran.

The tone of de-escalation helped reassure markets that a broader regional conflict—particularly one threatening global oil flows—may be avoided for now.

Oil Plummets on Supply Optimism, Geopolitical Fatigue

Despite the fresh missile launch, oil markets tumbled as traders priced in reduced likelihood of a prolonged disruption to Middle East energy flows. Crude traded as high as $73.84 earlier in the day before collapsing in the final two hours of trading.

Analysts cited improved U.S. and Qatari missile defenses, Tehran’s early-warning diplomacy, and President Trump’s dismissive tone as key factors behind the decline.

The move aligns with the baseline view laid out by Goldman Sachs on Monday. In a note to clients, economists Joseph Briggs and Megan Peters wrote that their commodities team continues to expect Brent prices to fall toward $60 by year-end, assuming no sustained supply disruption. Goldman said that even with reduced Iranian exports, the global economic impact would be modest: “a 0.1–0.2 percentage point drag on global GDP and a 0.2–0.4 percentage point lift to headline inflation.”

Goldman’s base case sees oil prices easing and delivering a “modest boost to global growth.”

Eyes on Powell Tuesday Morning

With the geopolitical picture temporarily stabilized, markets will shift their attention to Washington, where Federal Reserve Chairman Jerome Powell is set to deliver the central bank’s semi-annual Monetary Policy Report before the House Financial Services Committee at 10:00 a.m. ET Tuesday.

Investors will be looking for clues on the Fed’s inflation outlook and interest rate trajectory, especially amid easing energy prices and uncertain global demand.

Live @ 10 AM ET Tuesday June 24, 2025