Hormuz Deal Talk Splits Markets Amid Oil Price Volatility

Markets reacted mixed to reports that an interim deal is nearing completion to reopen the Strait of Hormuz, a critical shipping lane for oil. The news sent WTI crude prices down 1.1% to $74.93 per barrel and Brent crude down 0.3% to $79.02.

However, despite lower oil prices, Treasury yields remained relatively unchanged, with the 2-year yield around 4.2% and the 10-year yield around 4.62%. This suggests that investors are still cautious about potential geopolitical or growth shocks, rather than celebrating cheaper energy.

The mixed market reaction was reflected in US stocks, with the Dow rising 0.8% while the Nasdaq slipped 0.4%, led by materials and lagged by communication services. Gold prices jumped 4% to $4,241.96 and silver rose 3.5% to $62.37.