Dow Jones gains 275 points as ceasefire hopes lift stocks

• Oil prices remained volatile with WTI rising 4% above $98 per barrel as shipping through the Strait of Hormuz—carrying one-fifth of global oil supply—remains severely constrained despite the fragile ceasefire
• The CBOE Volatility Index dropped to its lowest level since the conflict began, while the S&P 500 gained 0.62% and Nasdaq climbed 0.83%, led by AI and retail stocks including Amazon
• Geopolitical uncertainty persists as Iran accuses Israel of ceasefire violations and President Trump warns US forces will remain until Iran complies with the agreement terms

Market Summary: Dow Jones Gains on Ceasefire Optimism

Market Performance:

U.S. stocks rallied Thursday with all major indices closing higher. The Dow Jones Industrial Average climbed 275.88 points (+0.58%) to 48,185.80, turning positive year-to-date. The S&P 500 gained 0.62% to 6,824.66, while the Nasdaq advanced 0.83% to 22,822.42.

Key Drivers:

Markets rose on tentative signs of de-escalation in Middle East tensions. Israeli Prime Minister Benjamin Netanyahu indicated openness to direct negotiations with Lebanon, boosting investor confidence. However, the ceasefire remains fragile, with Iran accusing Israel of violations and President Trump warning of continued U.S. military presence until compliance is achieved.

Energy Markets:

Oil prices remained volatile amid ongoing disruptions at the Strait of Hormuz, which handles approximately 20% of global oil supply. West Texas Intermediate futures rose ~4% to above $98/barrel (briefly crossing $100), while Brent crude traded above $96/barrel. Shipping activity through the strait remains significantly constrained.

Economic Data:

Commerce Department data showed Q4 economic growth slowed more than expected, with elevated inflation based on the PCE index. Federal Reserve minutes suggested policymakers are considering potential policy adjustments. The CBOE Volatility Index fell to its lowest level since the conflict began.

Sector Performance:

AI and technology stocks provided support, with Amazon and retail/semiconductor stocks outperforming. Sandisk rallied on positive price target revisions to $1,250 by Bernstein, while Palantir declined following concerns from investor Michael Burry about competitive pressure from Anthropic. Software stocks lagged overall market gains.

Outlook:

Markets remain sensitive to geopolitical developments, oil supply dynamics, and central bank policy signals in the near term.