08.04.202619:12:33UTC+00US Stocks Trim Gains, Remain Sharply Higher

US stocks pared some of their earlier gains on Wednesday after Iran accused the US of violating their ceasefire agreement, raising concerns that Tehran could prolong the region’s ongoing energy shock. Even with the pullback, equities finished sharply higher, with the S&P 500, the Dow, and the Nasdaq 100 each advancing more than 2.3%.

The latest tensions cast doubt on a two-week truce that was expected to boost tanker traffic through the Strait of Hormuz. Optimism over the deal had already faded after reports that Tehran had threatened multiple vessels attempting to leave the Persian Gulf.

Despite the geopolitical risks, oil prices remained sharply lower and Treasury yields extended their recent decline, helping to revive risk appetite even as the latest FOMC minutes warned of stagflation risks. Speculative AI-related names rallied strongly, with Nvidia, Meta, Tesla, AMD, and Micron jumping between 4% and 10%.

Airline stocks also surged on an improved outlook for jet fuel supply, while Delta gained 6% after reporting earnings.