March 24, 2026

U.S. stock markets surged sharply on Monday after President Trump announced progress in negotiations with Iran, though his claims were later refuted by Iranian officials. With conflicting reports circulating and U.S. military deployments to the Middle East continuing, uncertainty remains over whether global markets are approaching a turning point.

Market Intervention Efforts President Trump's recent statements have been interpreted by many market participants as another instance of the so-called "TACO" strategy—short for "Trump Always Chickens Out"—similar to the tariff-related market volatility seen in April of last year. The ongoing Middle East crisis continues to be a primary focus for Wall Street, with investors closely monitoring developments in Iran and the ripple effects of soaring energy prices. Three weeks into the U.S.-Israel military engagement with Iran, rising energy costs have heightened concerns about inflation and stalling economic growth.

Mounting inflation fears have nearly eliminated market expectations for interest rate cuts this year, which were previously seen as supportive for equities. Federal Reserve Chair Powell indicated during last week’s Fed meeting that the crisis has introduced significant uncertainty into the economic outlook, complicating the central bank’s ability to forecast future conditions.

Boris Schlossberg, a macro strategist at BK Asset Management, noted that, in his view, Trump is attempting to stabilize the markets. "The situation remains highly fluid, and it is too early to call a turning point. What is clear is that the longer the conflict persists, the greater the potential impact on the U.S. economy. For Trump, the midterm elections are a critical concern," he stated.

Sharp swings in crude oil prices have affected various asset classes. Last Thursday, both WTI and Brent crude benchmarks surged above the $100 per barrel mark. In addition to attacks on energy infrastructure, shipping through the Strait of Hormuz—a transit route for roughly one-fifth of global crude oil and liquefied natural gas—has come to a standstill. Data from the London Stock Exchange Group shows a strong negative correlation between the S&P 500 Index and U.S. crude prices, with a 20-day correlation coefficient of -0.926.

Eric Kuby, Chief Investment Officer at North Star Investment Management, commented, "Traders are closely watching oil prices, as they often serve as a leading indicator of how financial markets perceive the conflict’s trajectory."

Rising energy prices and cautious stances from global central banks have driven U.S. Treasury yields higher, creating a potential headwind for equities. The benchmark 10-year Treasury yield reached 4.328%, its highest level since August of last year.

Keith Lerner, Chief Investment Officer at Truist Advisory Services, said he is monitoring whether the 10-year yield can sustain a break above 4.3%, which could further pressure stock markets. "Higher interest rates mean increased borrowing costs, which could slow economic growth," Lerner explained. "If yields continue to climb, bonds may become increasingly attractive relative to stocks."

Outlook and Market Reaction Monday’s market reversal during European trading hours followed a shift in President Trump’s stance. According to news reports, Trump stated that the U.S. and Iran held "very good and productive discussions" aimed at "completely resolving hostilities in the Middle East." He also announced that he had ordered the military to delay all strikes on Iranian power plants and energy infrastructure for five days, "pending the outcome of ongoing talks and consultations."

However, Iran’s parliament publicly disputed Trump’s account, highlighting a clear divergence in how the two sides characterize the negotiations.

Mark Hackett, Head of Investment Research at Nationwide, suggested that institutional investors appeared to be aggressively covering short positions on Monday following heavy selling the previous week. "The fact that stock indices gave up some of their early gains indicates that investors are skeptical of Trump’s initial claims about progress with Iran," he noted.

Michael Brown, Senior Research Strategist at Pepperstone, observed that Trump appears to be seeking de-escalation and an exit strategy. "It may be premature to conclude that financial markets have reached a definitive turning point—especially since the Strait of Hormuz remains closed," he added.

Notably, reports indicate that several thousand U.S. Marines are scheduled to arrive in the Middle East on March 27—the same day President Trump has set as a new "deadline" for Iran to reopen the Strait of Hormuz.

Schlossberg cautioned that, given Trump’s fluctuating stance on Iran in recent days, investors should remain vigilant and wait for greater clarity before making decisive moves. "The situation is evolving rapidly, and market sentiment could shift abruptly," he warned.