Wall Street jumps as Trump eases Iran tensions

Doha [Qatar], June 12: U.S. stocks are climbing, and oil prices are falling Thursday after President Donald Trump called off his threat to bomb Iran in the evening.
The S&P 500 jumped 1.3%, coming off a back-to-back drop that had yanked it back to where it was in early May. The Dow Jones Industrial Average was up 802 points, or 1.6%, as of 2 p.m. Eastern time, and the Nasdaq composite was 1.8% higher.
Stocks leaped immediately after Trump said on his social media network that "discussions with the Islamic Republic of Iran have been brought to the highest level of Iranian leadership and approved" and that the time and place of a signing will "be announced shortly." A deal to end the war with Iran could reopen the Strait of Hormuz and allow oil tankers to carry crude again from the Persian Gulf to customers worldwide. Hopes that the global flow of oil can get going again sent the price for a barrel of benchmark U.S. crude down 2.8% to $87.56. Brent crude, the international standard, fell 3.5% to $89.84 per barrel, though it's still above its roughly $70 price from before the war. Worries had been high because the United States and Iran launched attacks over the past several days threatening a more than monthlong tenuous ceasefire. High oil prices caused by the Iran war have sent inflation painfully upward, and a report on Thursday showed that prices at the U.S. wholesale level increased by more in May than economists expected. The effect is worldwide, and the European Central Bank on Thursday became the first major central bank to raise interest rates in response.
Higher rates can keep a lid on inflation. But they also simultaneously slow entire economies and undercut prices for all kinds of investments, including stocks and cryptocurrencies. They hit investments seen as the most expensive in particular, and some critics are calling the artificial-intelligence industry a bubble where investment inflated too far. Big swings for AI stocks have been yanking the U.S. stock market in their wake over the last week, and they were a bigger factor for Wall Street than the war with Iran as they went from roaring to records to suddenly turning lower.
Source: Qatar Tribune