Wall Street advances as hopes of Iran war resolution lift risk appetite

NEW YORK: Wall Street’s main indexes rose on Wednesday, building onto their biggest one-day gains in nearly a year, after President Donald Trump’s comments suggested an end to the Middle East conflict could be close.

Trump told Reuters that the US would end its war on Iran fairly soon and could return for “spot hits” if needed, hours before he was scheduled to make a primetime address to the nation.

“The market has been caught in an increasingly asymmetric reaction function toward headlines,” said Mark Hackett, chief markets strategist for Nationwide, highlighting that markets gain early in the week on de-escalation signs but end in declines.

“The market’s tone still resembles a coiled spring that could release once we see tangible signs of de-escalation and some normalization in the oil market.”

Meanwhile, SpaceX confidentially filed for an initial public offering, a person familiar with the matter told Reuters, sending space stocks higher.

Intuitive Machines gained 10 percent, Planet Labs was up 9 percent and Rocket Lab added 5.1 percent. Destiny Tech100 jumped 8.2 percent as SpaceX is the fund’s largest holding.

Eli Lilly jumped 4.6 percent after the US Food and Drug Administration approved the drugmaker’s weight loss pill, to be sold under the brand name Foundayo.

Technology shares rose for a second session, up 1.6 percent. Intel gained 9.7 percent after plans to buy back Apollo’s stake in its Ireland factory for USD14.2 billion. Chipmakers were the biggest boosts with the Philadelphia Semiconductor Index adding 3.7 percent.

At 11:48 a.m. ET, the Dow Jones Industrial Average rose 430.39 points, or 0.93 percent, to 46,771.90, the S&P 500 gained 69.78 points, or 1.07 percent, to 6,598.30 and the Nasdaq Composite gained 338.20 points, or 1.57 percent, to 21,928.83.

The CBOE Volatility Index, Wall Street’s fear gauge, slipped to an over one-week low.

Oil prices fell as much as 3 percent on Wednesday, pulling the S&P 500 energy index down 4 percent to an over one-week low. Airlines jumped, with the S&P Composite Passenger Airlines sub-index up 3.2 percent.

The S&P 500 industrial index was the biggest percentage gainer among peers.

Among others, Nike slumped 14 percent to a decade low after the sportswear giant forecast a surprise drop in its fourth-quarter sales.