U.S. Markets Hold Steady as Iran War De-Escalation Signals Ease Oil and Inflation Concerns

Index Update:  U.S. stock futures hovered around flat levels as crude oil prices declined after President Donald Trump indicated that the Iran conflict may be nearing its end, easing concerns about the economic impact of higher oil prices. Lower Treasury yields supported credit-sensitive sectors, offering relief to major banks that had faced pressure from rising lending costs and private credit risks. Meanwhile, semiconductor stocks maintained strong gains following TSMC’s report of a 30% increase in sales during the first two months of the year.

Market Movers:  On Monday, the top gainers were Garden Stage Limited (+151.54%), followed by AN2 Therapeutics, Inc. (+84.21%). On the contrary, Innovation Beverage Group Limited. (-40.14%), and TMD Energy Limited (-26.37%) declined the most the same day.

Commodities Update: WTI and Brent crude futures declined on Tuesday after surging close to USD 120 per barrel in the previous session, as U.S. President Donald Trump indicated that the war with Iran may be nearing its end and that military operations are progressing faster than expected. Trump also signaled plans to waive certain oil-related sanctions and deploy the U.S. Navy to escort tankers through the Strait of Hormuz to stabilize energy markets. Additional downward pressure came after G7 finance ministers stated they are prepared to release oil from strategic reserves if needed. Oil prices had previously spiked amid supply disruptions in the Strait of Hormuz, which forced major Middle Eastern producers—including Saudi Arabia, the UAE, Kuwait, and Iraq—to curb production as tanker traffic slowed and storage capacity filled rapidly. Gold rose to around USD 5,180 per ounce and silver climbed to about USD 89 per ounce on Tuesday, recovering from the previous session’s decline as the U.S. dollar weakened following President Donald Trump’s remarks suggesting the Middle East conflict may end soon. Trump described the military operation in Iran as progressing faster than expected and indicated plans to waive oil-related sanctions and deploy the U.S. Navy to escort tankers through the Strait of Hormuz to stabilize energy markets. Earlier, rising oil prices and geopolitical tensions had strengthened the dollar and reduced expectations for Federal Reserve rate cuts, with markets now pricing in roughly 40 basis points of easing by year-end compared with over 55 basis points in late February. Investors are now focused on upcoming U.S. inflation data, including CPI and PCE, for further signals on price trends and the Fed’s policy outlook.

Macro Updates:  U.S. Small Business Optimism Edges Lower in February

The NFIB Small Business Optimism Index declined for the second consecutive month to 98.8 in February 2026 from 99.3 in January, falling short of forecasts of 99.7. Despite the slight dip, small businesses reported greater certainty about the near-term outlook, supported by stronger sales and improved profitability. However, competition from larger companies continued to pressure smaller firms. The share of owners expecting higher real sales volumes dropped by 8 points to a net 8%, while labor quality cited as the top business problem declined to 15%, the lowest level since April 2020. Meanwhile, 59% of businesses reported some impact from supply chain disruptions, slightly down from the previous month.

U.S. Dollar Weakens as Iran War Concerns Ease

The U.S. dollar index remained below 99 on Tuesday after a sharp decline in the previous session, as expectations for a quicker end to the Iran conflict reduced safe-haven demand for the currency. President Donald Trump indicated that the U.S. military operation in Iran is nearing completion and progressing faster than initially expected, while also proposing measures such as waiving certain oil-related sanctions and deploying the U.S. Navy to escort tankers through the Strait of Hormuz to stabilize oil prices. The dollar had previously strengthened amid geopolitical tensions and rising oil prices that raised concerns about inflation and economic disruption. Investors are now focused on upcoming U.S. inflation data, including the February CPI and January PCE reports, for further insights into price trends.

Bonds Commentary:  The yield on the U.S. 10-year Treasury note stabilized around 4.11% on Tuesday after briefly reaching 4.21% in the previous session, as falling oil prices eased concerns about renewed inflation. Crude retreated below USD 90 per barrel after President Donald Trump indicated the Iran conflict may be nearing its end and outlined measures to keep oil prices contained, while G7 finance ministers signaled readiness to release strategic reserves if necessary. The softer inflation outlook revived expectations for Federal Reserve rate cuts in July and September, with markets pricing in roughly two 25-basis-point reductions this year, as investors await upcoming CPI and PCE data for further guidance on inflation trends.

Futures Update:  U.S. stock futures trimmed earlier gains on Tuesday as uncertainty surrounding the outlook for the Iran conflict weighed on sentiment, despite President Donald Trump suggesting the war could end soon. Dow futures slipped 0.1%, S&P 500 futures declined 0.1%, while Nasdaq 100 futures edged slightly higher by 0.1%.

Stocks started Monday sharply lower but staged a significant recovery throughout the session. The S&P 500 rose 55.97 points (0.83%), closing at 6,795.98. From a technical perspective, the index found support at key levels and gradually moved higher, suggesting the potential for further gains in today’s session. However, the 50-period Exponential Moving Average (EMA) has begun to slope downward after a sustained uptrend, and prices have pulled back, signaling the possibility of a short-term decline. Meanwhile, the 14-day Relative Strength Index (RSI) has fallen below its midpoint, indicating a cautious short-term outlook. Immediate support is identified around 6,777, which may serve as a potential bounce zone, while near-term resistance is near 6,855.