Closing: S&P Index rises 1.2% as oil price retreat boosts stock gains

At 3 a.m. Beijing time on March 17, U.S. stocks maintained their rally into the close on Monday, with all three major indices rising. Investors are watching for the latest developments in the Iran conflict. Brent crude oil fell below $100 per barrel, and WTI oil prices retreated to below $95 per barrel.

The Dow rose 464.88 points, or 1.00%, to 47,023.35; the Nasdaq increased 326.53 points, or 1.48%, to 22,431.89; the S&P 500 gained 79.67 points, or 1.20%, to 6,711.86.

Affected by a report, Meta’s stock rose 2.4%, with the report stating the company plans to cut more than 20% of its staff, though the company called the report “speculative.” Additionally, Nvidia’s stock rose over 1 ahead of its GTC conference opening on Monday.

As diplomatic efforts to reopen the Strait of Hormuz made progress, concerns about long-term energy supply disruptions eased.

The CBOE Volatility Index (VIX) fell 7.4% to 25.17, reflecting a significant decline in recent market panic sentiment.

The S&P index rose nearly 1%, indicating broad-based gains rather than being limited to a single sector.

Brent crude oil dropping below $100 per barrel is a key driver behind everything.

Brent crude briefly touched $105 per barrel early Monday before falling below $100. WTI crude surged from $71 on March 2 to $94.65 on March 9, placing its price in the 99.6th percentile of the past 12 months. The rally was fueled by Iran’s blockade of the Strait of Hormuz, cutting off a critical artery for global oil exports.

This relief rally coincides with President Trump threatening to reconsider leniency toward Iran’s oil facilities unless the strait is reopened, and his administration beginning to announce plans to form a coalition to escort ships through the waterway. Iraq has also begun efforts to resume the Kirkuk-Turkey pipeline.

Goldman Sachs analysts noted, “The current supply shock seems concentrated in the energy sector,” which differs from the broader inflation surge that followed. This assessment is important because it suggests central banks may not need to react too aggressively, providing room for a rebound in U.S. stocks.

Despite the decline on Monday, the VIX remains at 25, well above its one-year average of 19, at the 93.8th percentile of the past year. The index has been highly volatile over the past year, spiking to 52.33 during the tariff panic in April 2025 and compressing to 13.47 by the end of December. The significant drop on Monday is notable but does not eliminate the sharp rise caused by recent geopolitical shocks.

As oil prices fall, U.S. Treasury Secretary Janet Yellen announced Monday that the U.S. will allow Iranian oil tankers to pass through the Strait of Hormuz. Additionally, U.S. officials said the U.S. will soon announce the formation of a multilateral coalition to escort ships through the strait, which also contributed to the oil prices retreating from highs.

President Trump ordered strikes on Iranian military assets on Hack Island on Friday. While the attack did not impact oil infrastructure, Trump stated that if Iran continues to blockade the strait, the U.S. will consider targeting those facilities.

Over the weekend, Trump also told the media that Iran wants to reach an agreement, but he is not ready yet.

Jeremy Siegel of Wharton School said Monday, “The market believes we are indeed in a favorable position regarding Iran; they will reach an agreement, possibly this week. Of course, there are many tail risks, but it’s safe to say… the market is definitely leaning in that direction.”

However, despite geopolitical tensions, U.S. stocks have experienced relatively mild sell-offs. The S&P 500 is only about 5% below its all-time high earlier this year.

Eddie Yardeni, president of Yardeni Research, wrote, “The resilience of the S&P 500 is attributed to increasingly optimistic analyst expectations for earnings per share in 2026 and 2027. Clearly, they have not yet realized the potential negative consequences of war delays and the closure of the strait.”