Markets had opened sharply lower after Donald Trump warned of intensified military action against Iran in the coming weeks, fuelling fears of a prolonged conflict and further disruption to global energy supplies, News.az reports, citing Xinhua.
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Stocks recover from early sell-off
By mid afternoon trading, major US indices had clawed back much of their earlier declines.
The S&P 500 was down 0.1 percent after falling as much as 1.5 percent earlier in the session. The NASDAQ Composite also slipped 0.1 percent, recovering from a drop of more than 2 percent, while the Dow Jones Industrial Average was lower by 0.3 percent after earlier losses exceeding 1 percent.
Analysts said markets remain highly sensitive to developments in the Middle East, with sentiment shifting rapidly in response to geopolitical headlines.
Hormuz developments offer cautious relief
Investor sentiment improved after Iranian state media reported that Tehran is drafting a protocol with Oman to manage shipping traffic through the Strait of Hormuz.
The route is a critical artery for global energy supplies, accounting for roughly a fifth of the world’s oil and gas flows.
Iranian officials said the proposed framework is aimed at facilitating safe passage and improving services for vessels, rather than restricting transit.
The move raised cautious hopes that some stability could return to oil markets after days of sharp volatility.
Oil prices remain elevated
Despite the announcement, oil prices remained significantly higher.
Brent crude was last up about 7 percent at just over 108 dollars per barrel, while US West Texas Intermediate futures were nearly 11 percent higher at around 111 dollars.
Prices had surged earlier in the session following Trump’s warning of intensified military operations, reflecting fears of supply disruptions linked to the conflict.
Investors remain cautious ahead of long weekend
Market participants continued to adopt a cautious stance ahead of the Good Friday holiday, which will see US markets closed while key economic data, including the monthly jobs report, is still due for release.
Analysts say the combination of geopolitical uncertainty and upcoming economic indicators is contributing to heightened volatility.
Outlook driven by conflict and energy markets
Strategists noted that markets are currently being driven largely by oil price movements, which are seen as a key barometer of the conflict’s trajectory.
While the prospect of reopening the Strait of Hormuz provided some relief, uncertainty remains high, particularly as tensions between the United States and Iran show little sign of easing.
Investors are likely to remain focused on geopolitical developments in the days ahead, with expectations of continued sharp swings in both equity and commodity markets until clearer signals emerge.
