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Oil prices fall, but stocks rise as investors look forward to progress in Iran War Talks

Investors were hopeful about possible progress in the Middle East peace talks on Thursday, even though the U.S. remained opposed to Iran's uranium stockpiles and its control over the Strait of Hormuz. The gap between the U.S. and Iran has narrowed according to a senior Iranian source. Marco Rubio, the U.S. secretary of state, said that there have been "some positive signs" during the talks. However, any toll in the Strait would not be acceptable. U.S. president Donald Trump stated that the U.S. would eventually recover Iran's highly enriched stockpile. The oil prices were higher in the morning, but the major U.S. indexes fell after reports that Iran's supreme ruler had issued a directive to prevent the export of the country's near weapons-grade uranium. Treasury yields in the U.S. fell in the afternoon on hopes that a peace deal would be reached. The yield of the benchmark 10-year Treasury Note was down 0.8 basis point on the day to 4.575%. On Tuesday, it reached its highest level since January 2025. The war that began on 28 February has caused energy prices to soar and raised concerns about inflation and consumer spending.

U.S. crude dropped $1.91 and settled at $96.35. Brent fell $2.44 to settle at $102.58.

Adam Sarhan, CEO of 50 Park Investments, New York, said, "Oil has dropped below $100 and that is a good thing." Sarhan also said that investors have been optimistic about the future of stocks, especially in technology. Nvidia shares, the largest company in the world by market cap, finished down 1.8%, as investors retreated after recent gains. Nvidia announced a $80 billion share purchase program late Wednesday. The company reported earnings that exceeded Wall Street expectations. The Dow Jones Industrial Average increased by 276.31 points or 0.55% to 50,285.66, while the S&P 500 gained 12.75 points or 0.17% to 7,445.72; and the Nasdaq Composite grew 22.74 points or 0.09% to 26,293.10. The MSCI index of global stocks rose by 5.24 points or 0.48% to 1,106.89. The pan-European STOXX 600 finished with a gain of 0.04%. IBM shares rose 12.4% following news that the Trump Administration will fund a few quantum computing companies including a new IBM Venture in exchange for stakes. D-Wave Quantum shares and other quantum computing companies also soared.

Rick Meckler of Cherry Lane Investments said, "If you look at the normal economic climate surrounding this market, then you'd expect the stocks to be lower. But if you think the war is going to end soon, and that energy prices are at a temporary peak, then you should consider not only the good earnings, but also the potential earnings from AI." SpaceX filed its IPO late on Wednesday. This gave the market their first look at how much Elon Musk spends on AI. He is betting on transforming SpaceX into a broader AI business. Investors also watched developments in 'Turkey. The trading on Turkey's stock exchange was temporarily suspended after steep falls, and government bonds were also impacted after a ruling by one of the top courts in the country dealt the latest blow against the main political opponent party. The court ruled that the Republican People's Party's congress of 2023, at which Ozgur Ozel was elected, should be annulled. The U.S. traded iShares MSCI Turkey Exchange-Traded Fund was?down by 9.2%. Dollar index was flat on Thursday evening as traders assessed the chances of a short-term agreement to end the war. The index had earlier reached a six-week-high. The dollar index (which measures the greenback versus a basket including the yen, the euro and other currencies) was flat on the day, at 99.13. Meanwhile, the euro fell 0.03% to $1.1624. Gold spot fell 0.04%, to $4541.79 per ounce. (Reporting from Caroline Valetkevitch and Harry Robertson, in New York, and Gregor Stuart Hunter, in London, with additional reporting by Gregor Stuart Hunter, in Singapore, and editing by Alex Richardson and Chizu Nomiyama; Will Dunham, Chris Reese, and Alex Richardson)

(source: Reuters)