CNBC Daily Open: Markets cheer as Trump and Tehran agree to 2-week ceasefire

• Iran confirmed it would abide by the ceasefire and allow safe passage through the Strait of Hormuz, a critical artery for global oil flows, pending coordination with its Armed Forces
• The ceasefire came after U.S. forces struck military targets on Kharg Island, Iran's main oil export terminal, and Trump had warned 'a whole civilization' would die without an agreement
• Oil market disruptions had already impacted global operations, with U.S. jet fuel prices nearly doubling since the conflict began and airlines cutting routes, particularly international ones

Market Summary: U.S.-Iran Ceasefire Agreement

Key Developments

President Donald Trump announced a two-week suspension of military operations against Iran just before his 8 p.m. ET deadline regarding the reopening of the Strait of Hormuz. Trump stated the U.S. received a 10-point proposal from Iran that provides a "workable basis" for negotiations. Iran's Supreme National Security Council confirmed it would cease defensive operations and allow safe passage through the Strait of Hormuz, subject to technical coordination.

Market Impact

• U.S. stock futures surged following the ceasefire announcement
• Oil prices plummeted over 14% to below $100 per barrel after the agreement
• Major U.S. indexes had already shown cautious optimism during Tuesday's session
• U.S. jet fuel prices had nearly doubled since conflict escalation, prompting airlines to reduce capacity, particularly on international routes

Recent Military Actions

U.S. forces struck military targets on Kharg Island, Iran's main oil export terminal, shortly before the ceasefire. Iranian missile strikes on Tuesday sparked a fire at Saudi Arabia's Jubail complex, the country's largest industrial hub housing major refining and petrochemical facilities.

Mediation and Context

Pakistan played a mediating role in securing the two-week pause. Previous negotiations had centered on longer ceasefires of up to 45 days, but Iran had rejected temporary truces in favor of permanent solutions.

Other Corporate News

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The ceasefire provides crucial relief for global supply chains and energy markets severely strained by disruptions to oil flows through the critical Strait of Hormuz.