US stocks ended higher on Thursday, with the Dow Jones Industrial Average gaining more than 900 points, as investors welcomed signs of easing tensions between the United States and Iran and returned to technology shares following a sharp selloff earlier in the week.
The Dow Jones rose 929 points, or 1.84%, to close at 50,847.50.
The S&P 500 advanced 1.75% to 7,393.85, while the Nasdaq Composite climbed 2.53% to 25,801.47.
Markets extended gains after President Donald Trump announced that planned military action against Iran had been canceled and suggested that a diplomatic agreement was nearing completion.
Trump told reporters in the Oval Office that “we have a deal that Iran will never have a nuclear weapon.” He continued, “We have a signing soon, and the documents are in pretty final shape. It should be done and it should be done pretty quickly.”
Earlier in the day, Trump said on Truth Social that he “cancelled the scheduled strikes and bombings against Iran this evening.”
“The Naval Blockade will remain in full force and effect until this Transaction is finalized — Time and place of the signing to be announced shortly,” he added.
Oil prices fall as Iran tensions ease
Investor sentiment improved significantly as the prospect of immediate military escalation appeared to diminish.
West Texas Intermediate crude futures fell about 3% to around $86 per barrel, while Brent crude also declined roughly 3% to approximately $89 per barrel following Trump’s comments.
The move marked a sharp reversal from earlier concerns after Trump had previously posted that the United States would strike Iran “VERY HARD TONIGHT” and suggested the possibility of taking control of key Iranian oil infrastructure.
Market participants appeared encouraged by the shift toward diplomacy.
Chip stocks lead market rebound
Technology shares were among the strongest performers as semiconductor stocks rebounded from recent weakness.
Micron Technology, Advanced Micro Devices, and Intel all moved higher, helping drive a 6% gain in the iShares Semiconductor ETF.
The semiconductor sector had been under pressure following a 10% decline in the chip ETF last week, prompting concerns that the artificial intelligence-driven rally may have been losing momentum.
Intel received an additional boost after Bank of America upgraded the stock to Buy from Underperform. Shares gained about 7% following the upgrade.
Investors also continued to focus on the upcoming public debut of SpaceX, which is expected to begin trading on Friday after pricing its initial public offering at $135 per share.
The offering raised a record $75 billion through the sale of 555.56 million shares and valued the company at approximately $1.77 trillion, making it the largest U.S. initial public offering on record.
Inflation data and Fed outlook remain in focus
Investors also assessed fresh economic data that painted a mixed picture of inflation and labor market conditions.
The Bureau of Labor Statistics reported that producer prices increased 1.1% in May, exceeding economists’ expectations of 0.7%.
Core inflation, which excludes food and energy prices, rose 0.4%, below forecasts of 0.5%.
Separately, unemployment claims increased modestly during the previous week.
Despite ongoing inflation concerns, markets continue to expect the Federal Reserve to leave interest rates unchanged at its policy meeting next week. Investors are still pricing in at least one 25-basis-point rate increase before the end of the year.
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