New York: US stocks closed with gains Monday as investors seemed to begin to recover from the shock of the start of the Israel-Iran conflict. The Dow Jones Industrial Average increased by 0.75%, adding 317.30 points to finish at 42,515.09. The Nasdaq Composite gained 1.52% to end at 19,701.21, while the S and P 500 rose by 0.94% to close at 6,033.11.
According to Anadolu Agency, tensions in the Middle East escalated since Friday when Israel launched coordinated airstrikes on multiple sites across Iran, including military and nuclear facilities. This prompted Tehran to launch retaliatory strikes, impacting global markets. Brent crude oil prices rose approximately 11%, and gold surpassed the $3,450 mark.
Despite the ongoing conflict, Iran's decision not to close the Strait of Hormuz, contrary to expectations, contributed to a partial retreat in oil prices, which fell 2.27% on Monday, supporting the markets. Israeli authorities reported at least 24 people killed and hundreds injured in Iranian missile attacks since Friday. Conversely, Iran reported at least 224 fatalities and over 1,000 injuries from the Israeli assault.
In a related development, US President Donald Trump expressed optimism regarding a trade deal with Canada, stating that an agreement is "achievable." Trump highlighted the differences in opinion over the "concept" to resolve the trade dispute and mentioned ongoing discussions between US and Canadian delegations. Speaking in Canada, alongside Canadian Prime Minister Mark Carney, Trump emphasized his preference for tariffs as a straightforward solution.
Investors are also anticipating the outcomes of the Federal Open Market Committee (FOMC) meeting, with announcements expected on Wednesday. The central bank is predicted to maintain the current policy rate. Analysts are eager for insights into future monetary policy from Fed Chair Jerome Powell's statements and the economic projections to be released post-meeting.
The VIX index, known as the "fear index," showed an 8.21% decrease to 19.11 points after rising above 21 on Friday following Israel's strikes on Iran.