US Markets React to Middle East De-escalation Ahead of Pivotal FOMC Meeting

US equity markets closed mixed on Friday night as investors weighed concerns over artificial intelligence (AI) spending against signs of de-escalation in the Middle East.

A glimmer of hope came from reports that China was pushing to revive stalled peace talks between Washington and Tehran, followed by the notable absence of US strikes on Iran after a 13th consecutive night of strikes.

This development resulted in Iran announcing it had paused its retaliatory strikes, with reports emerging that US and Iranian mediators were exchanging messages.

The combination of these events marked the first concrete sign of de-escalation since tensions began rising earlier this month.