U.S. stocks edged higher, JPMorgan warns Tesla's stock could drop another 60%, crude oil holds steady at $110.

Ask AI · How do the latest developments in the U.S.-Iran ceasefire negotiations sway Wall Street sentiment?

Wall Street edged higher on Monday as investors watched developments in the U.S.-Iran ceasefire talks. U.S. President Trump warned that if Iran does not reopen the Strait of Hormuz, he will increase pressure on Iran. By the close, the Dow Jones Industrial Average rose by about 165.21 points, up 0.36% to 46,669.88; the Nasdaq Composite rose 0.54% to 21,996.34; and the S&P 500 rose 0.44% to 6,611.83.

Mega-cap tech stocks mixed. Amazon, Apple, and Google were up more than 1%, Nvidia gained 0.14%, while Microsoft and Meta edged lower. Tesla fell 2.15%. JPMorgan Chase cut its earnings forecast for Tesla and warned that the stock price has 60% downside potential.

On individual stocks, the storage sector performed well. Seagate Technology rose 5.58%, and Morgan Stanley raised its target price from $468 to $582. Western Digital, Micron Technology, and SanDisk all rose more than 3%.

The Philadelphia Semiconductor Index rose 1.32%. Marvell Technology rose 2.24%, AMD rose 1.23%, and TSMC and Intel rose 0.80%.

Asset-management giant Invesco fell 5.2%. Earlier, Goldman Sachs cut its target price for Invesco from $30 to $27 and maintained a “Neutral” rating.

The Nasdaq China Golden Dragon Index fell 0.21%. Alibaba, Baidu, and JD.com rose about 0.2%; PDD Holdings was flat; and NetEase fell 0.16%.

The situation in the Middle East remains tense. According to CCTV News, on April 6 local time at a news briefing held at the White House, U.S. President Trump said that if Iran does not “surrender” before 8:00 p.m. U.S. Eastern Time on April 7, he will launch strikes on Iran’s civilian infrastructure. Trump said an agreement must be reached by the final deadline on April 7 that he can accept. He claimed he would destroy Iran’s bridges and power plants, saying, “I have already put together a plan.” Once it is activated, “every single bridge inside Iran will be completely destroyed, and every single power plant inside Iran will be completely incapacitated.” He also said that if the United States is willing, “the entire destruction process would take only four short hours.” However, he said he “does not want this to happen.”

Earlier reports said the U.S., Iran, and mediators in the relevant region were discussing “the terms of a potential 45-day ceasefire agreement.” The agreement is intended to push for a complete end to the war. Citing Iran’s Islamic Republic News Agency on April 6, Xinhua News Agency reported that Iran has responded to Pakistan to the proposal from the United States to end the war. The response included 10 provisions. The core content includes: emphasizing that there must be a permanent end to the war based on Iran’s concerns; and presenting a series of demands, such as ending regional conflicts, setting up a security passage agreement for the Strait of Hormuz, post-war reconstruction, and lifting sanctions.

In a client report released on Monday, the Wells Fargo Investment Institute said: “In the coming weeks, the risk of war escalation will remain high. Higher oil prices raise transportation and fertilizer costs, intensifying the economic challenges faced by global economies that rely on energy imports.”

JPMorgan Chase CEO Jamie Dimon said that supply-chain disruptions caused by the Iran war may keep inflation and interest rates at levels higher than expected.

The war between the U.S. and Iran has disrupted markets for more than a month. A surge in crude oil prices has triggered inflation concerns, and the stock market has fallen sharply, with the S&P 500 down 4% since the outbreak of the conflict. After Trump’s remarks, the Chicago Options Exchange Volatility Index (VIX) has continued to remain elevated at 24.17.

“Perhaps the market is underestimating the severity of the impact on the global economy,” Michael Rosen, chief investment officer at Angeles Investments, said. “I think the market has not fully recognized the short- and medium-term impact of energy supply disruptions, which means energy prices will stay high for a longer period of time.”

Thomas Martin, a senior portfolio manager at GLOBALT, said: “On days like today, investors don’t have much to do. We actually don’t know which side the truth of any news is really on—whether it’s the U.S., Iran, or Pakistan.” Martin added: “Trump has to get the Strait of Hormuz reopened… he’s making a big issue of it. Investors are all on edge, anxiously waiting.”

In the medium- to long-term U.S. Treasury market, yields fluctuated within a narrow range. The benchmark 10-year U.S. Treasury yield fell 1 basis point to 4.34%. The 2-year U.S. Treasury yield, which is closely tied to interest-rate expectations, was basically flat at 3.85%.

As for economic data, the figures released on Monday showed that the U.S. March ISM Services PMI fell from 56.1 to 54, with the expansion pace slower than expected. At the same time, employment in the industry contracted, while the Prices Paid Index—an inflation forward-looking indicator—surged to the highest level since October 2022.

In a report, ING (International Group) said: “The ISM services data performed reasonably in line with the U.S. 2026 economic 2.5% annualized growth expectations. But what’s worrying is that in March, the employment component fell sharply and input prices surged, showing that after Middle East conflict intensified economic and market anxiety, corporate cautious sentiment has been warming up.”

International oil prices hit a low and then rebounded. The U.S.-Iran ceasefire deal remains clouded in uncertainty. OPEC and its allies (OPEC+) reached an agreement last Sunday among eight member countries, agreeing to increase May’s daily oil production quotas by 206k barrels for a second consecutive month of production hikes. The WTI front-month contract rose 0.78% to $112.41 per barrel, and the Brent front-month contract rose 0.90% to $110.05 per barrel.

The precious metals market fluctuated slightly. The market focused on the outlook for U.S. inflation and the Middle East situation. As of the time of publication, COMEX gold for June delivery on the New York Mercantile Exchange was down nearly 0.2%, trading around $4,670 per ounce. COMEX silver futures were flat at $72.90 per ounce.

Source: First Finance and Economics