Oil prices plunge on Israel-Iran truce; US stock markets rise

International oil prices fall by nearly 5%, spot gold below $3,300

Powell: "Until the impact of tariffs is clear," signals rate cut after September

With the Middle East truce agreement, crude oil prices plummeted, and on the 24th (local time), the US stock markets closed higher.

At 10 a.m. Eastern Standard Time, the S&P 500 rose 0.6%, the Nasdaq increased 0.9%, and the Dow Jones Industrial Average went up by 0.6%.

At 1 a.m. on the 24th EST, President Trump announced the truce between Israel and Iran on his social media, causing international oil prices to plunge by almost 5%. As of 10 a.m., benchmark Brent Crude and West Texas Intermediate (WTI) were each down 4.6%, trading at $68 and $65 per barrel, respectively.

The US dollar, which had risen after the US attack on Iran, declined by 0.4% against major currencies on news of the truce. The spot gold price fell 2% to $3,298 per ounce, while Bitcoin rose 1.3% to recover to 105,127.

Tesla, whose share price had surged the previous day on the release of its robotaxi, turned lower, dropping 0.8%. NVIDIA rose 2% and traded at $147, while AMD, which was upgraded to 'Buy' by an analyst, soared nearly 6%.

As oil prices tumbled, inflation concerns eased, raising hopes that the Federal Reserve would have room to cut rates despite Jerome Powell's cautious signals. The 10-year Treasury yield, which had declined early in the morning, rose 3 basis points (1bp=0.01%) to 4.357%.

Powell suggested in a prepared speech to Congress that the Fed would not rush to cut rates until the impact of tariffs became clear. His remarks suggest that the timing of a Fed rate decision will be in September.

Today, he will testify before the House Financial Services Committee at 10 a.m., and on the 25th before the Senate Banking Committee.

Krishna Guha of Evercore interpreted, "If Chairman Powell's prepared testimony resembles what was revealed at the June Fed meeting, it is a polite rejection of Waller and Bowman's efforts to push for a July rate cut."

Matt Maley of Miller Tabak said, "Although the risks related to the Middle East conflict have certainly decreased significantly, the US stock market's risk/reward equation is still heavily skewed toward risk." He emphasized, "With US economic growth rates declining and corporate earnings forecasts falling, the stock market remains highly overvalued. While it could reach new all-time highs, caution is warranted regarding additional upside."

Contributing Reporter Jungah Kim kja@hankyung.com