Global stocks jumped on Monday, while oil prices sank, as investors parsed signs that the U.S. and Iran may be approaching a permanent peace deal, though both sides tempered expectations for an immediate agreement.
In Europe, the pan-regional Stoxx 600 rose 0.9%, nearing levels not seen since early March, with German and French stocks advancing in likely thin trading due to holidays in the U.S. and UK.
U.S. stock futures also climbed. Dow futures added 432 points, or 0.9%, S&P 500 futures gained 70 points, or 0.9%, and Nasdaq 100 futures were up 409 points, or 1.4% by 06:51 ET (10:51 GMT). Wall Street will be closed today for Memorial Day.
Iran and the U.S. have reached a framework for a deal to end their more than two-month conflict, but a potential memorandum of understanding does not include specifics about the Strait of Hormuz management, according to a news report citing an Iranian foreign ministry spokesperson.
An agreement between Tehran and Washington cannot be said to be imminent, though both sides have reached conclusions on a range of topics, the spokesperson said.
Oil prices fell sharply, with Brent breaking below $100 a barrel, but remain well above pre-war levels of around $70 a barrel.
The Iranian spokesperson said Tehran will not take tolls from vessels traversing the strait, potentially reversing a major threat. However, any services provided will 'require a price but should not be presented as tolls.'
The draft agreement also reportedly includes a commitment by Iran not to pursue nuclear weapons and to enter negotiations on future uranium enrichment.
Writing on social media, U.S. President Donald Trump said he told his representatives 'not to rush into a deal,' adding that the blockade on Iranian ports would stay until an agreement is 'reached, certified, and signed.'
U.S. Secretary of State Marco Rubio said Washington would pursue all diplomatic avenues with Iran, but warned of 'alternatives' if these efforts fail.
