April 7 Closing: U.S. stocks close slightly higher as markets focus on developments in the Middle East

In the early hours of April 7 Beijing time, U.S. stocks rose on Monday. The S&P 500 index continued last week’s gains. The market remained focused on developments in the Middle East. Reports said Iran and the United States are seeking a ceasefire, but Trump claimed he could wipe out Iran by Tuesday, and the U.S. defense secretary previewed a major strike against Iran.

The Dow rose 165.21 points, up 0.36%, to 46669.88; the Nasdaq rose 117.16 points, up 0.54%, to 21996.34; and the S&P 500 index rose 29.33 points, up 0.45%, to 6612.02.

According to reports, the United States, Iran, and some regional mediators are discussing terms for a potential 45-day ceasefire. The agreement could ultimately end the war, but the likelihood of reaching a partial agreement before Tuesday’s deadline is low.

It is understood that mediators from Pakistan, Egypt, and Turkey have put forward a 45-day ceasefire proposal between the U.S. and Iran. Trump said Monday that the proposal is not good enough.

At the White House, Trump told reporters: “It’s not good enough, but it’s a very important step. They are now negotiating, and they have already taken a very important step. We’ll see.”

Earlier, a White House official told the media that Trump has not yet approved the proposal. The official said this is just one of many ideas. Axios first reported the proposal.

Trump also told reporters on Monday that Iran could be wiped out overnight—“and that night could be tomorrow night”—and warned Tehran that it must reach an agreement before Tuesday night or face consequences.

“A whole country can be wiped out overnight, and that night could be tomorrow night,” Trump said at a White House press conference.

At a briefing, U.S. Defense Secretary Hegseth said the biggest strike since the start of U.S. actions against Iran would take place on Monday, and warned that the strike on Tuesday would be even more forceful.

In addition, there are reports that Iran and the United States have received a plan to end hostilities. If an agreement is reached, fighting would stop immediately and the Strait of Hormuz would be reopened. An anonymous source told the media that the framework agreement was proposed by Pakistan and could take effect on Monday.

Trump has set a final deadline of before Tuesday for Iran to reopen the Strait of Hormuz, or it will face strikes on its power plants and bridges. On Sunday, in a profanity-laden social media post, Trump warned that if Iran does not open the strait, they will “live in hell.”

Trump then posted “Tuesday night at 8 PM ET!” but provided no further explanation.

Iran’s attacks on tankers have effectively kept the strait closed. This sea route connects the Persian Gulf to global markets. Before the war, about 20% of the world’s supply passed through the strait.

The closure of the strait triggered the largest oil supply disruption in history. Since the war began, prices for crude oil, jet fuel, diesel, and gasoline have risen sharply.

In a nationwide address last Wednesday, Trump said the war would last two to three weeks.

According to data from TD Securities, if the Strait of Hormuz remains blocked through the end of this month, global markets would lose nearly 1 billion barrels of oil supply, including up to 600 million barrels of crude oil and about 350 million barrels of refined products.

U.S. stocks performed strongly last week. The S&P 500 index rose 3.4%, ending five straight weeks of declines, and delivered its best weekly performance since late November. The Dow and Nasdaq also ended their respective five-week losing streaks. The Dow rose 3% last week, and the Nasdaq gained 4.4%.

However, these gains did not come easily. Last week’s major stock indexes saw sharp volatility as traders assessed the latest developments in the Iran-U.S. war and judged when the conflict might end.

On Sunday, Trump warned that if the Strait of Hormuz is not reopened before Tuesday, the U.S. will strike Iran’s power plants and bridges. Later on Monday night, he said that although he wanted to seize Iran’s oil, “we will not take further action.”

“What do I want to do? Take the oil, because the oil is there, waiting to be taken,” he continued. “They can’t do anything about it. Unfortunately, the American people want us to go home.”

Early this week, oil prices saw violent swings in choppy trading. U.S. West Texas Intermediate (WTI) crude for the May contract rose by 1% to above $112 per barrel. International benchmark Brent crude rose 1% to above $109 per barrel.

Michael Rosen, Chief Investment Officer at Angeles Investments, said: “The market may be underestimating the extent of chaos in the world economy. I think the direct and medium-term impact of energy disruption may also be underpriced by the market, which means energy prices will likely stay high for a longer period of time.”

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Editor: Zhang Jun SF065