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The S&P 500 Index closed up 0.96% on Monday, while the Dow Jones Industrials gained 0.89% and the Nasdaq 100 rose 1.06%. This market rally followed a missile attack on a U.S. airbase in Qatar by Iran, which was perceived as a controlled response to recent U.S. airstrikes on Iran’s nuclear facilities, resulting in no reported damage or injuries. President Trump expressed optimism about potential de-escalation in the Middle East conflict.
WTI crude oil prices dropped over 7% after a more than 6% overnight spike, as market speculation suggested that Iran’s retaliatory actions would not adversely impact oil supplies from the Middle East. Economic data released on Monday showed that the U.S. manufacturing PMI for June was unchanged at 52.0, and existing home sales unexpectedly increased by 0.8% month-over-month to 4.03 million homes, beating forecasts.
The 10-year Treasury note yield fell to 4.33%, marking a six-week low, as expectations for a possible Fed rate cut next month gained traction following dovish comments from Fed officials. Current market predictions estimate a 23% chance for a 25 basis point cut at the upcoming FOMC meeting.
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