Oil Eases, Stocks Steady as Hopes for U.S.-Iran Peace Talks Grow

By Dow Jones Newswires Staff

Oil edged lower and stocks stabilized on increased hopes that talks in Pakistan between the U.S. and Iran would lead to a deal to end the war in the Middle East.

Tehran told regional mediators Tuesday that it would send negotiators to talks in Islamabad, easing confusion over Iran's participation in discussions that investors hope will definitively see the re-opening of the Strait of Hormuz, The Wall Street Journal reported.

U.S. Treasurys and the dollar traded flat. Investors remain watchful, after President Trump said a U.S. blockade of Iranian ports would remain in place and threatened to attack infrastructure if the country doesn't make a deal.

Trump's pick for Federal Reserve chair, Kevin Warsh, is set to face a confirmation hearing before the Senate Banking Committee later. Investors will also watch for March U.S. retail sales data for early signals on how the Middle East conflict has hit the real economy.

--Brent crude for June delivery was down 0.3% to $95.25 a barrel, while WTI futures for May fell 0.5% to $89.12 a barrel in early European trade.

"The aim, of course, is to establish a viable off-ramp that enables energy flows through the Strait of Hormuz to resume on a sustained, long-term basis," analysts at ING said. However, "optimism appears to be clouding the reality of the supply shock."

--U.S. futures for the S&P 500 were up 0.2%, while the Dow Jones Industrial Average climbed 0.1%. The tech-heavy Nasdaq was up 0.3% premarket.

Amazon shares jumped 3% premarket after the e-commerce giant said it would invest an additional $5 billion in Anthropic. GE Aerospace, RTX and UnitedHealth Group are among blue-chip stocks reporting earnings ahead of market open.

--Asian stocks mostly rose Tuesday. Japan's Nikkei Stock Average rose 0.9% to 59349.17 and South Korea's Kospi rose 2.7% to close at a new record, supported by its chip stocks. Hong Kong's Hang Seng Index put up 0.4%.

China's Victory Giant raised 20.12 billion Hong Kong dollars, or US$2.57 billion in Hong Kong, marking the largest IPO in the city since Zijin Gold International.

--European stocks were largely higher at market open. Technology stocks gained and healthcare slipped as the Europe-wide Stoxx 600 edged up 0.05%. London's FTSE 100 was flat, with Associated British Foods falling 5.6% after the group said it would spin off clothes retailer Primark. The German DAX rose 0.5%, led by a 2.2% gain for chemicals group Brenntag. The FTSE MIB and the Spanish IBEX 35 were both up 0.3%, while the Dutch AEX was up 0.2%. In Paris, the CAC 40 slipped 0.1%.

--The dollar traded steady, with the DXY dollar index flat at 98.141.

Sterling rose against the euro and trimmed losses versus the dollar after data showed an unexpected fall in the U.K. unemployment rate.

--Treasury yields were little changed in Asian trade. As well as the Middle East conflict, investors will focus on the Senate confirmation hearing for Kevin Warsh. The two-year Treasury yield was up 0.6 basis points at 3.721%, while the 10-year Treasury yield fell 0.6 basis points to 4.243%.

Eurozone government bond yields fell, even as uncertainty continued in the Middle East. Both government bond supply and data releases will be limited in the eurozone on Tuesday, with Germany launching the new June 2028 Schatz with 6 billion euros on offer, and Finland auctioning 1.5 billion euros in April 2029- and April 2045-dated bonds. The 10-year German Bund yield fell 1.9 basis points to 2.967%, while French OAT and Italian BTP yields fell slightly more.

--Bitcoin fell 0.4% to $76,034.

--Gold futures slipped but remained above $4,800 a troy ounce. "Plans for fresh talks in Pakistan offered some optimism ahead of a looming ceasefire deadline," said Soojin Kim from MUFG. "However, the war continues to disrupt global energy supplies, reinforcing inflationary pressures and expectations that central banks will keep interest rates elevated, a negative for non-yielding gold." In early European trading, New York gold futures fell 0.6% to $4,800.50 a troy ounce. Silver was down 1.3% to $79.01 an ounce, while platinum slipped 0.4% to $2,078.70 an ounce.

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(END) Dow Jones Newswires

04-21-26 0425ET