Iran War To End 'Soon' Says Trump, Oil Prices Tumble As Stocks Gain

Key takeaways

President Trump claims the conflict with Iran may be resolved soon, indicating a decline in oil prices.
The stock market reacted positively to the prospect of an end to the war, with notable gains in technology shares.
Warsh's candidacy for Federal Reserve chair faces political hurdles related to ongoing investigations.
Recent criminal cases in New York highlight issues surrounding public safety and accountability.

Summary

Iran Conflict Update

In a significant briefing, President Trump stated that the U.S. and Israel are nearing a resolution to the ongoing conflict with Iran, potentially closing the hostilities very soon. He mentioned that while the fighting might not conclude this week, operations are ahead of schedule, particularly concerning military actions that have diminished Iran's capabilities significantly. The closure of the Strait of Hormuz, crucial for global oil supply, has put upward pressure on oil prices but is expected to stabilize as U.S. Navy escorts help maintain shipping routes.

Market Response to War Projections

Following President Trump's comments on the Iran conflict, oil prices saw a sharp decline, after peaking earlier due to fears surrounding the conflict. Brent crude prices dropped from nearly $120 to around $91.50. Conversely, equity markets responded positively, with notable gains in the MSCI Asia Pacific Index, propelled primarily by technology stocks. However, futures for the S&P 500 showed some hesitation, indicating a mixed sentiment about the sustainability of this market rebound.

Federal Reserve Leadership Dynamics

As the Senate considers Kevin Warsh's nomination to replace Jerome Powell as the chair of the Federal Reserve, he is engaging in discussions with various senators to solidify support for his confirmation. Warsh's nomination faces scrutiny as Republican Senator Tom Tillis has called for the Justice Department's investigation into the Federal Reserve to conclude before moving forward with the hearing.

Legal Issues in Pennsylvania and New York

In other news, two young men were charged with serious offenses related to homemade bombs at a protest in New York City, reportedly expressing extremist motivations. Meanwhile, three brothers in New York City were convicted for conspiring to drug and sexually assault multiple women, highlighting ongoing legal challenges and societal issues surrounding safety and accountability in urban environments.

Show notes

Today's top stories, with context, in just 15 minutes.
On today's podcast:
1) President Trump on Monday said the US and Israel were making significant progress in their war on Iran and could end the conflict “very soon,” curtailing an oil-price surge. Trump said he didn’t believe the fighting would be over this week, but insisted the operation was ahead of schedule. The US Navy will escort tankers out of the Middle East to maintain a steady oil supply through the Strait of Hormuz, he added. The effective closure of the strait, vital to the world’s flow of petroleum and to container shipping, has caused oil and natural gas prices to soar, and stoked fears of inflation. Brent crude, having climbed to almost $120 a barrel early Monday, is back down to $91.50, but is still up more than 50% this year on the US-Iran tensions. There’s as yet little sign Hormuz can be opened quickly, with Iran continuing to retaliate with drone and missile strikes across the region.
2) Stocks rose and crude oil fell as President Trump signaled the Iran war may be nearing an end, helping boost sentiment after Monday’s selloff in risk assets. The MSCI Asia Pacific Index climbed 3.1%, with technology shares leading gains. European stocks were also set to advance with contracts indicating a 1.4% jump at the open. However, equity-index futures for the S&P 500 Index slipped 0.2%, indicating the recovery that started on Wall Street on Monday may be running out of steam. The rebound in sentiment for markets came as Trump said the war with Iran would be resolved “very soon.” Even so, from the UAE to Bahrain to Kuwait, several Middle Eastern countries announced missile threats, sounded sirens or intercepted drones on Tuesday. Trump said he didn’t believe the conflict would be over this week.
3) Kevin Warsh will meet with senators this week as he seeks their approval to become chairman of the Federal Reserve, according to three people familiar with the plans. The customary meetings with senators before his expected hearing mark the next stage in Warsh’s quest to replace Jerome Powell as the head of the national monetary system. One of the senators on Warsh’s schedule is Sen. Thom Tillis (R-N.C.), according to two of the people. Tillis has said he likes Warsh as a potential chairman but opposes moving the nomination until the Justice Department halts its investigation of into the Federal Reserve’s $2.5 billion renovation of its headquarters. Tillis has warned the probe amounts to inappropriate pressure on Powell to lower interest rates. Trump formally nominated Warsh last week in hopes of replacing Powell before the incumbent’s term expires May 15. Treasury Secretary Scott Bessent has said he expects Warsh to get a hearing, notwithstanding Tillis’s blockade.

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