Concerns About Ceasefire Fragility May Lead To Pullback On Wall Street

The major U.S. index futures are currently pointing to a lower open on Thursday, with stocks likely to give back ground following the substantial rally seen in the previous session.

Traders may look to cash in on Wednesday’s strong gains amid concerns about the fragility of the ceasefire in the Middle East, with Iran accusing the U.S. and Israel of violating the agreement.

Iran’s deputy foreign minister Saeed Khatibzadeh claimed in an interview with the BBC that Iran has once again closed the Strait of Hormuz.

Khatibzadeh argued Israeli attacks on Lebanon earlier in the day were an “intentional grave violation” of the ceasefire agreement.

Crude oil futures have shown a notable rebound in reaction to the news, with U.S. crude oil futures spiking by more than 5 percent after plummeting by more than 16 percent on Wednesday.

“There is an air of renewed nervousness pervading financial markets after the euphoria which was initially prompted by the US-Iran ceasefire,” said Dan Coatsworth, head of markets at AJ Bell.

“This agreement already seems to be fraying at the edges – with continued strikes by Israel on Lebanon a key sticking point,” he added. “With talks on a lasting deal yet to begin it’s understandable that investors are taking a circumspect view.”

President Donald Trump said in a post on Truth Social late Wednesday that U.S. forces would remain in the region until a “real agreement” is reached with Iran and “fully complied with.”

Stocks moved sharply higher at the start of trading on Wednesday and continued to turn in a strong performance throughout the session. With the surge, the major averages ended the day at their best closing levels in about a month.

The major averages all showed substantial moves to the upside after ending Tuesday’s trading narrowly mixed. The Dow spiked 1,325.46 points or 2.9 percent to 47,909.92, the Nasdaq surged 617.15 points or 2.8 percent to 22,635.00 and the S&P 500 shot up 165.96 points or 2.5 percent to 6,782.81.

The initial surge on Wall Street came in reaction to news that the U.S., Israel and Iran have agreed to a two-week ceasefire.

In a Truth Social post Tuesday evening, President Donald Trump said he has agreed to suspend the bombing and attack of Iran for a period of two weeks subject to Tehran agreeing to the complete, immediate and safe opening of the Strait of Hormuz.

Trump said the U.S. has received a 10-point proposal from Iran that he believes is a “workable basis on which to negotiate” and said the two-week ceasefire will allow the agreement to be finalized and consummated.

A subsequent statement from Iran’s Foreign Minister Abbas Araghchi indicated the Strait of Hormuz will be reopened for a period of two weeks if the attacks against Iran are halted.

The news has contributed to a nosedive by the price of crude oil, with U.S. crude oil futures plunging by more than 15 percent and dropping well below $100 a barrel.

“The positive market reaction is understandable as a two-week ceasefire raises hope for a complete end to the conflict,” said Dan Coatsworth, head of markets at AJ Bell.

“The ceasefire gives the world a moment to breathe and take stock of events,” he added. “Unfortunately, there is no guarantee that everything will return to normal.”

Airline stocks turned in some of the market’s best performances on the day, with the NYSE Arca Airline Index soaring by 7.3 percent to its best closing level in a month.

Substantial strength was also visible among semiconductor stocks, as reflected by the 6.3 percent spike by the Philadelphia Semiconductor Index.

Networking stocks also showed a significant move to the upside, driving the NYSE Arca Networking Index up by 5.3 percent.

Housing, computer hardware and financial stocks also saw considerable strength, while oil producer and natural gas stocks bucked the uptrend.

Commodity, Currency Markets

Crude oil futures are surging $5.09 to $99.50 a barrel after diving $18.54 to $94.41 barrel on Wednesday. Meanwhile, after advancing $92.50 to $4,777.20 an ounce in the previous session, gold futures are slipping $10.70 to $4,766.50 an ounce.

On the currency front, the U.S. dollar is trading at 159.06 yen versus the 158.58 yen it fetched at the close of New York trading on Wednesday. Against the euro, the dollar is valued at $1.1683 compared to yesterday’s $1.1662.

Asia

Asian stocks ended mostly lower on Thursday in the face of growing signs of fragility in the two-week ceasefire pact between the United States and Iran.

The Islamic Republic closed the Strait of Hormuz after claiming that several terms of the ceasefire agreement had been breached. Iranian Parliament Speaker Mohammad-Bagher Ghalibaf said three clauses of the proposal had been contravened, so far.

U.S. President Donald Trump announced that U.S. forces will remain deployed around the region, warning of strong action if Iran fails to follow ceasefire terms.

As Israel pounds Lebanon, U.S. Vice President JD Vance clarified that Lebanon was never part of the ceasefire agreement.

The dollar remained on shaky footing in Asian trading and gold prices were little changed above $4,700 an ounce, while Brent crude prices jumped more than 3 percent toward $98 a barrel on doubts about the durability of the fragile Middle East ceasefire.

China’s Shanghai Composite Index dropped 0.7 percent to 3,966.17 and Hong Kong’s Hang Seng Index fell 0.5 percent to 25,752.40, with geopolitical tensions and upcoming Chinese inflation data in focus.

Japanese markets ended lower as escalating violence in Lebanon cast doubt on the potential for a lasting peace agreement.

The Nikkei 225 Index slid 0.7 percent to 55,895.32 after rallying 5.4 percent in the previous session. The broader Topix Index settled 0.9 percent lower at 3,741.47.

Seoul stocks ended lower on profit taking as Iran continued to flex its control over the vital oil artery, demanding tolls for safe passage.

The Kospi tumbled 1.6 percent to 5,778.01 after surging 6.8 percent on Wednesday. Foreign investors led a broad sell-off, with Samsung Electronics and SK Hynix falling over 3 percent each.

Australian markets eked out modest gains, with energy stocks and defensives pacing the gainers. The benchmark S&P/ASX 200 Index edged up by 0.2 percent to 8,973.20, while the broader All Ordinaries Index finished marginally higher at 9,168.90.

Bendigo and Adelaide Bank soared 8.4 percent after posting a rise in third quarter earnings and flagging job cuts.

Across the Tasman, New Zealand’s benchmark S&P/NZX-50 Index ended up 0.2 percent at 13,273.81, giving up some early gains as disagreements persisted over the scope of the U.S.-Iran truce.

Europe

European stocks traded lower on Thursday as German industrial output data disappointed and doubts grew over the Midde East truce.

German industrial production unexpectedly dropped in February even before the outbreak of war in the Middle East, data from Destatis revealed.

Industrial production fell 0.3 percent in February compared to January, when it was flat. Production was expected to grow 0.6 percent.

Euro zone government bond yields edged higher as cracks quickly began to appear in the fragile Gulf truce. With Israel expanding Lebanon strikes, the Islamic Republic has closed the Strait of Hormuz.

Iran’s semi-official news agencies published a chart today, suggesting the country’s Revolutionary Guard Navy put sea mines into the Strait of Hormuz during the war.

“The U.S. must choose ceasefire or continued war via Israel. It cannot have both. The world sees the massacres in Lebanon. The ball is in the U.S. court, and the world is watching whether it will act on its commitments,” Iran Foreign Minister Araghchi said in a post on X.

U.S. President Donald Trump said that U.S. military forces will remain deployed in and around Iran until Tehran fully complies with the “real agreement.”

While the German DAX Index is down by 1.1 percent, the French CAC 40 Index is down by 0.6 percent and the U.K.’s FTSE 100 Index is down by 0.3 percent.

In corporate news, Dutch pharmaceutical compounding company Fagron has fallen despite reporting a robust revenue performance for the first quarter.

British American Tobacco has also dropped after appointing Dragos Constantinescu as its new chief financial officer.

Meanwhile, London Stock Exchange Group has moved to the upside after launching a share buyback program of up to 900 million pounds.

U.S. Economic News

The Labor Department released a report on Thursday showing first-time claims for U.S. unemployment benefits rose by more than expected in the week ended April 4th.

The report said initial jobless claims climbed to 219,000, an increase of 16,000 from the previous week’s revised level of 203,000.

Economists had expected jobless claims to rise to 210,000 from the 202,000 originally reported for the previous month.

The Labor Department said the less volatile four-week moving average also crept up to 209,500, an increase of 1,500 from the previous week’s revised average of 208,000.

A separate report released by the Commerce Department on Thursday showed consumer prices in the U.S. increased in line with economist estimates in the month of February.

The Commerce Department said its personal consumption expenditures (PCE) price index climbed by 0.4 percent in February after rising by 0.3 percent in January. Economists had expected prices to increase by 0.4 percent.

The report also said the annual rate of growth by the PCE price index came in unchanged at 2.8 percent, which was also in line with estimates.

Excluding food and energy prices, the core PCE price index still climbed by 0.4 percent in February, matching the increase seen in January as well as expectations.

The annual rate of growth by the core PCE price index slipped to 3.0 percent in February from 3.1 percent in January. The modest slowdown was in line with estimates.

The Federal Reserve’s preferred readings on consumer price inflation were included in the Commerce Department’s report on personal income and spending.

The report said personal income edged down by 0.1 percent in February after climbing by 0.4 percent in January, while personal spending increased by 0.5 percent in February after rising by 0.3 percent in January.

The U.S. economy grew by less than previously estimated in the fourth quarter of 2025, according to a revised data released by the Commerce Department on Thursday.

The report said the increase in real gross domestic product in the fourth quarter was downwardly revised to 0.5 percent from the previously reported 0.7 percent. Economists had expected GDP growth to be unrevised.

The Commerce Department said the slower than previously estimated growth primarily reflected a downward revision to investment.

The downwardly revised GDP growth in the fourth quarter reflects a substantial slowdown compared to the 4.4 percent surge in the third quarter.

At 10 am ET, the Commerce Department is due to release its report on wholesale inventories in the month of February. Wholesale inventories are expected to dip by 0.2 percent.

The Treasury Department is scheduled to announce the results of this month’s auction of $22 billion worth of thirty-year bonds at 1 pm ET.