US stocks moved higher on Thursday as investors reacted to the interim US-Iran peace deal and a renewed debate over interest rates. Tech shares led the advance, helping the Nasdaq Composite rise nearly 2% while the S&P 500 gained 1.1%.
The Dow Jones Industrial Average lagged the broader market, but still added about 0.3% after a sharp selloff in the prior session. The move came as traders weighed a calmer energy backdrop against signs that the Federal Reserve may not be done tightening.
Peace Deal Eases One Source Of Market Stress
President Trump and his Iranian counterpart signed the memo outlining the agreement on Wednesday, according to the report. The deal reopened the Strait of Hormuz to commercial traffic, and the US removed its naval blockade in the region.
That shift helped keep oil prices in check, with Brent crude around $79 a barrel and West Texas Intermediate above $75 on Thursday. Brent has given back much of its war-time surge in recent weeks as crossings through the strait increased.
Fed Signals Keep Rates In Focus
Stocks also had to digest a more hawkish tone from the central bank after officials signaled a rate hike could still be on the table later this year. The Federal Reserve held policy steady on Wednesday, but the latest comments suggested inflation remains a concern.
Fresh Labor Department data added to that backdrop, showing initial jobless claims were slightly hotter than estimates but improved over the week prior. The job market has remained steady even as inflation stays elevated and conflict with Iran continues to shape expectations.
AI Chip Trade Joins The Market Mood
Tech strength also helped drive the broader rally as traders returned to AI chip trading. The rebound gave the market a more constructive tone even with rate uncertainty still hanging over the outlook.
Thursday was the final day of trading for Wall Street before markets closed on Friday for the Juneteenth holiday. That left investors with one more session to position around peace-deal optimism, oil moves, and the Fed’s next signal.
