Stocks Rise, Dollar Slides After Report Iran Contacted US To End War

by Stefan J. Bos, Worthy News Chief International Correspondent

NEW YORK/TEHRAN/JERUSALEM/BUDAPEST (Worthy News) – Stocks rebounded after a report that Iran made indirect contact with the United States to negotiate an end to the war in the Middle East, boosting hopes that the conflict could be short-lived.

The dollar halted a two-day rally. Futures for the S&P 500 index rose 0.2 percent, an indication of how Wall Street could perform after markets officially open in the United States.

European and U.S. market optimism came after operatives from Iran’s Ministry of Intelligence “used backchannels” to contact the U.S. Central Intelligence Agency (CIA) a day after U.S.-Israeli attacks began, The New York Times newspaper reported, citing Middle Eastern and Western officials briefed on the matter.

The outreach reportedly occurred through the intelligence service of a third country. Iranian intelligence officials had “signalled openness to talks” aimed at ending the conflict, the report said, though U.S. officials were reportedly skeptical about whether Tehran was genuinely seeking negotiations.

U.S. President Donald J. Trump also commented on the reported outreach, writing on social media that Iran wanted to talk but that it might be “too late,” as U.S. and Israeli military operations against the Islamic Republic continue.

Additionally, Iran publicly pushed back against the claims. Tehran’s ambassador to the United Nations in Geneva said Iran had not contacted the United States about peace talks, adding that “for the time being we are very doubtful about the usefulness of negotiation.”

MARKETS REACT QUICKLY

Yet, amid news of behind-the-scenes conversations, markets reacted quickly to the report. Brent crude retreated from an intraday high to trade below $83 a barrel, while European stocks extended gains to about 1.4 percent, according to the Bloomberg News agency.

A sell-off in global bonds also eased, with the yield on 10-year U.S. Treasury notes rising two basis points to around 4.08 percent, Bloomberg News reported.

Bitcoin climbed to about $71,000, suggesting a partial return of risk appetite among cryptocurrency investors after several days of geopolitical uncertainty.

Earlier in the day, Asia’s benchmark index plunged the most in nearly a year, led by a record sell-off in South Korean equities, market watchers noted.

While the United States is relatively immune as a “gigantic energy superpower,” Asian economies such as China, South Korea, and Japan are more dependent on oil flows from the Middle East, according to experts.

Despite the rebound, analysts warned markets remain highly sensitive to developments in the conflict, particularly any disruption to oil shipments through the Strait of Hormuz, a strategic waterway through which roughly one-fifth of global oil supplies normally pass.

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