US Markets Advance on AI Optimism While Iran Tensions Keep Commodities and Yields Elevated

index Update

US stocks closed higher on Wednesday, supported by easing energy prices and optimism ahead of Nvidia’s Earnings release, which is viewed as a key indicator for the AI-driven market rally. The S&P 500 gained 1%, while the Dow Jones and Nasdaq 100 advanced 1.2% each. Market sentiment improved after reports that three supertankers successfully exited the Strait of Hormuz and President Trump signaled that a potential agreement with Iran could be reached soon, easing concerns over energy-driven Inflation. Nvidia rose 1.5% ahead of expected strong earnings growth, while investors closely awaited its guidance for insights into future AI spending trends. The broader AI sector also benefited from reports that OpenAI could file for an IPO as early as Friday, reinforcing expectations for continued Investment in artificial intelligence infrastructure. Meanwhile, retail stocks including TJX and Target moved higher following their earnings results, while broader equities were additionally supported by lower Treasury yields despite hawkish Federal Reserve meeting minutes.

Market Movers

Among the session’s top gainers, HCW Biologics Inc. surged 129.25%, while VIDA Global Inc. advanced 81.22%. On the downside, Optimi Health Corp. declined 97.13%, and Antelope Enterprise Holdings Limited dropped 22.19%, making them the weakest performers of the Trading session

Commodities Update

WTI and Brent Crude futures rebounded around 2% on Thursday, climbing above $100 and $107 per barrel, respectively, after sharp declines in the previous two sessions, as uncertainty surrounding US-Iran negotiations and the future reopening of the Strait of Hormuz continued to support oil prices. Market sentiment remained cautious after reports indicated that Iran’s Supreme Leader refused to send near-weapons-grade uranium abroad, while Tehran also announced plans to enforce a “controlled maritime zone” in the Strait of Hormuz. Oil prices stayed nearly 50% above pre-war levels amid ongoing Supply concerns and significant US Strategic Petroleum Reserve drawdowns. Meanwhile, gold held above $4,500 an ounce and silver remained above $75 an ounce after strong prior-session gains, supported by expectations that a potential US-Iran peace agreement could ease inflationary pressures, stabilize oil markets, and reduce the likelihood of further aggressive monetary tightening. Investors also assessed Federal Reserve meeting minutes, which suggested policymakers remain open to additional rate hikes if inflation stays above target.

Macro Updates

Dollar Index Nears April Highs Amid Iran Tensions and Fed Rate Concerns

The dollar index climbed above 99.2 on Thursday, nearing its April highs, as renewed uncertainty surrounding the Iran conflict lifted oil prices and revived inflation concerns. Market sentiment weakened after reports indicated that Iran’s Supreme Leader rejected sending near-weapons-grade uranium abroad, complicating ongoing US-Iran peace negotiations. Meanwhile, minutes from the latest Federal Reserve meeting showed that most policymakers remain open to additional Interest Rate hikes if inflation stays above the Central Bank’s 2% target. Although markets still largely expect rates to remain unchanged through the rest of the year, traders are pricing in around a 40% probability of a 25-basis-point rate increase in December.

Bonds Commentary

The Yield on the US 10-year Treasury note climbed to 4.62% on Thursday, reversing the previous session’s decline, as renewed uncertainty surrounding US-Iran negotiations pushed oil prices higher and revived inflation concerns. Market sentiment weakened after reports indicated that Iran’s Supreme Leader opposed sending near-weapons-grade uranium abroad, complicating progress toward a potential peace agreement and raising doubts over the full reopening of the Strait of Hormuz. At the same time, minutes from the latest Federal Reserve meeting showed that most policymakers remain open to additional interest rate hikes if inflation stays above the central bank’s 2% target. While markets largely expect rates to remain unchanged through year-end, traders are still pricing in roughly a 40% probability of a 25-basis-point hike in December.

Futures Update

US Equity futures edged lower on Thursday as rising Treasury yields and cautious sentiment around AI-related earnings weighed on markets. Futures tied to the S&P 500 and Dow Jones fell around 0.3%, while Nasdaq 100 futures dropped 0.8% amid weakness in technology stocks. Nvidia traded near flat in premarket activity despite reporting stronger-than-expected earnings and raising its Dividend, as its forward guidance failed to exceed analysts’ highest expectations. Intuit shares plunged 15% following plans to reduce its workforce by 17%, while Walmart slipped 2% despite posting solid quarterly earnings, as concerns grew that sustained higher fuel costs could pressure future performance. Meanwhile, fading optimism around the resumption of Middle East energy exports pushed bond yields higher and added pressure on broader equity markets.

Stocks rebounded sharply on Wednesday after several weaker sessions, with the major averages posting strong gains as investors returned to risk assets. S&P 500 continues to maintain a strong bullish structure on the Daily Chart, trading firmly above both the 21-day and 50-day EMAs following its powerful V-shaped recovery from the April lows. The index closed near 7,433 after testing fresh highs around 7,480, confirming that buyers remain in control of the broader trend, although momentum has started to cool slightly after an overbought stretch. RSI has eased back into the mid-60s from near 80, suggesting consolidation rather than a confirmed Reversal, while stable Volume trends imply institutional support remains intact despite moderating momentum. Technically, the outlook stays bullish above 7,400, with resistance seen at 7,460–7,480 and a breakout above 7,520 potentially opening the door for another leg higher, whereas failure to hold support could trigger a short-term pullback toward the rising 21 EMA near 7,285.