US equity markets opened sharply higher on Monday, driven by a sudden de-escalation in geopolitical tensions between the United States and Iran.
The broad-based rally was underpinned by a collapse in energy prices, with West Texas Intermediate (WTI) crude falling more than 6% after President Donald Trump announced that direct conversations with Iranian officials had commenced.
2% in early trading as investors rotated out of safe-haven assets and back into riskier equities.
The Dow Jones Industrial Average led the advance, gaining 1.2% in early trading as investors rotated out of safe-haven assets and back into riskier equities.
The market move reflects a rapid repricing of Middle East risk premiums.
For weeks, shipping disruptions and the threat of broader conflict had weighed on global growth expectations and kept energy costs elevated.
The news of diplomatic engagement removed a significant overhang, allowing traders to focus on domestic economic data rather than geopolitical tail risks.