Global markets surged Wednesday as hopes mounted that U.S. military action against Iran could soon end. President Donald Trump indicated attacks may conclude in two to three weeks, with potential for "spot hits" if needed.
Wall Street responded strongly: the Dow rose 0.55% to 46,594.37, the S&P 500 gained 0.63% to 6,569.57, and the Nasdaq climbed 1.01% to 21,808.66. Europe’s STOXX 600 jumped 2.24%, led by travel and defense stocks. Asia-Pacific shares outside Japan rose 4.57%, while Japan’s Nikkei surged 5.24%.
Brent crude futures fell 2.23% to $101.65 a barrel, and U.S. crude dropped 2.19% to $99.16. Gold rose for a fourth straight session, climbing 1.57% to $4,742.70 an ounce as the dollar weakened.
The U.S. dollar index slipped 0.3% to 99.43, while U.S. Treasury yields rose slightly - the 10-year note yield edged up to 4.319%. Fed funds futures now price a 17.9% chance of a July rate cut, up from 7.5% a day earlier.
Economists remain cautious. "Markets are trading this narrative that the war could be over," said Evelyne Gomez-Liechti of Mizuho. "But skepticism remains."
The euro neared a three-week high versus the dollar. Germany’s 10-year bond yield dipped to 2.96%, its lowest in two weeks.