Stocks Surge, Oil Plunges Most in Months as Trump Eases Iran Threat

Stocks surged into Monday’s close as oil prices plunged following signs of easing tensions with Iran, boosting risk appetite across equities. The Dow Jones Industrial Average jumped 631 points to 46,208.5, while the S&P 500 gained 74.51 points to 6,580.99 and the Nasdaq Composite advanced 299.15 points to 21,946.8.

The primary driver was a steep drop in crude prices after President Donald Trump said he would delay threatened strikes on Iranian energy infrastructure and pointed to renewed diplomatic talks. According to Bloomberg, the move came after pressure from U.S. allies and was aimed in part at calming markets rattled by the conflict . Oil tumbled more than 10% to $88.09 a barrel, marking one of the sharpest single-day declines in recent months.

Equities tracked oil lower throughout the session, with stocks rebounding sharply after early volatility. At one point earlier in the day, markets were choppy as investors weighed geopolitical risks, but sentiment improved steadily as energy prices collapsed and fears of supply disruption eased.

The drop in crude also pulled down inflation hedges, with gold falling 3.6%, while the CBOE Volatility Index declined to 25.80, signaling reduced demand for downside protection.

Beyond geopolitics, underlying economic data suggested continued resilience among U.S. consumers.

Bank of America Institute data showed household deposit balances remained above inflation-adjusted 2019 levels in February, with lower-income households seeing their first year-over-year increase in nearly four years. Analysts said that cushion could help sustain spending even as gasoline prices remain volatile.

Energy stocks lagged amid the oil selloff, while technology and growth sectors led gains, benefiting from easing rate and inflation pressures tied to falling commodity prices.

Investors now turn to upcoming economic data and any further developments in U.S.–Iran negotiations, which remain the dominant near-term driver for both energy markets and broader risk sentiment.