US stocks rallied sharply as Trump cancelled planned Iran strikes, easing oil-price fears. The Dow jumped 930 points, chip stocks rebounded strongly, while Oracle fell on a USD 20 billion funding plan.

Key Highlights

  • Dow Jones Industrial Average surged 929.97 points, or 1.86%, to settle at 50,848.75.
  • S&P 500 gained 1.75% and Nasdaq Composite added 2.54% as risk sentiment recovered sharply.
  • iShares Semiconductor ETF advanced more than 8%, led by Intel's 9% gain following a Bank of America upgrade.
  • Oracle shares fell 8% after the company disclosed plans for a USD 20 billion equity and debt raise.
  • WTI crude settled down 2.58% at USD 87.71 per barrel following Trump's cancellation of Iran strikes.

Geopolitical Reversal Drives US Equity Rebound

US equity markets posted broad gains on Thursday, recovering from a turbulent stretch as a sharp shift in US-Iran tensions triggered a risk-on rotation across major indices.

The S&P 500 closed at 7,394.29, up 1.75%, while the Nasdaq Composite settled at 25,809.66, adding 2.54%. The Dow Jones Industrial Average rose 929.97 points, or 1.86%, to finish at 50,848.75.

The catalyst was unambiguous. President Donald Trump cancelled planned US military strikes against Iran and signalled that a nuclear agreement was close to being finalised. Speaking from the Oval Office, Trump indicated that deal documents were in near-final form and that a signing was expected shortly. The announcement reversed an earlier escalation in which Trump had stated on Truth Social that the US would strike Iran, and had threatened to seize Kharg Island, the hub through which approximately 90% of Iranian crude exports flow.

Crude oil reflected the reversal immediately. West Texas Intermediate futures fell 2.58% to settle at USD 87.71 per barrel, and Brent crude declined 2.92% to end at USD 90.38.

Chip Stocks Recover; Intel Leads

The semiconductor sector provided substantial upside momentum. The iShares Semiconductor ETF advanced more than 8%, staging a meaningful recovery after a 10% decline the prior Friday had prompted broad investor concern about whether the sector's extended rally had peaked. Micron Technology (NASDAQ:MU), Advanced Micro Devices (NASDAQ:AMD), and Intel (NASDAQ:INTL) all contributed to the rebound.

Intel's performance stood out. Bank of America upgraded the stock from underperform to buy on Thursday, and shares responded with a 9% gain, one of the more decisive single-session moves among large-cap semiconductor names.

Attention is also building ahead of SpaceX's scheduled market debut on Friday, set to be the largest IPO in history at a roughly USD 1.8 trillion valuation. Some market participants have attributed recent chip-sector weakness in part to portfolio repositioning ahead of the listing, with investors trimming existing technology holdings to accommodate the new issue.

Oracle Diverges From the Broader Rally

Not all technology names participated in Thursday's recovery. Oracle (NYSE:ORCL) shares fell approximately 8% after the company disclosed plans to raise an additional USD 20 billion in equity and debt to fund its artificial intelligence infrastructure buildout. The announcement weighed on sentiment despite the company reporting an overall beat on revenue and adjusted earnings in its most recent quarter.

The divergence underscores a structural tension emerging within the technology sector: while AI-related capital expenditure is broadly viewed as a long-term growth driver, the near-term dilution and cash flow implications of large-scale capital raises are increasingly being priced with discipline by institutional investors.

Inflation Data Adds Complexity

The macro backdrop offered a mixed signal. Producer price index data released Thursday showed a monthly increase of 1.1% in May, above the 0.7% consensus estimate. The 12-month headline rate reached 6.5%. Core inflation, which strips out food and energy, came in at 0.4%, modestly below forecast.

Thomas Martin, senior portfolio manager at Globalt Investments, noted that equity markets have remained relatively composed throughout the Iran conflict, with oil-price pressures not yet showing decisive pass-through into broader inflation measures. The underlying economic conditions, in his view, remain broadly supportive.

That assessment holds for now. Should the Iran situation remain unresolved or the proposed agreement encounter friction, energy prices could resume their upward trajectory and complicate the Federal Reserve's already narrow policy path.

Conclusion

Thursday's session illustrated how sensitive current market conditions are to geopolitical signals. The underlying picture combines resilient economic fundamentals with above-target inflation and elevated geopolitical risk, a combination that warrants measured interpretation of single-session moves. Whether the Iran deal materialises on the timeline suggested, and how that translates to sustained energy price relief, will be central to how equity and fixed income markets are positioned heading into the second half of the year.