Stocks Soar as Trump Gives Iran Two Weeks to Negotiate

U.S. stocks rocketed higher on Friday, but investors are still walking on eggshells. The Dow Jones Industrial Average, S&P 500, and Nasdaq all snagged gains after President Donald Trump laid down a two-week window for Iran to come to the table.

After a chill Juneteenth break on Thursday, June 19, the markets roared back to life on Friday with the Dow Jones Industrial Average blasting off nearly 150 points higher right from the opening bell.

The S&P 500 was doing a tightrope walk near the flatline, up just 0.4%, while the Nasdaq Composite sprinted ahead by 0.6%. Trump's latest words and hints at a Federal Reserve rate cut were like rocket fuel for the markets.

Middle East conflict: Trump offers deadline

The buzz around town was all about the escalating drama in the Middle East, with Israel and Iran going at it. Stocks tanked on Wednesday after Trump hinted the U.S. might jump into the fray.

But then, the White House threw out a statement saying Trump's holding off on any attacks on Iran to give negotiations a shot. He's given Tehran a two-week ultimatum, while whispers say Israel's strikes might crank up over the weekend.

“If Trump does end up deciding to attack Iran, he’ll likely wait until after 4PM ET on Friday. That way, the shock of bombing is softened as much as possible by the time markets open on Monday,” said Jesse Cohen, a global markets whiz.

Stocks and cryptos have been on a wild ride with all this back-and-forth. Bitcoin (BTC) shot up from $104k to over $106k. Even with all the geopolitical fireworks, QCP analysts say the volatility isn’t going anywhere.

“Markets are hanging in limbo. Everyone's chewing on the geopolitical news and rejigging their risk as tensions ramp up. Volatility might just be catching its breath, not gone,” QCP dropped on X.

Oil prices have been jerking around with the Middle East chaos too, swinging up and down with the latest updates. Traders are on edge, worried that if Iran blocks the Strait of Hormuz, oil prices could go through the roof.

Will Fed cut rates in July?

Amid all this geopolitical noise, everyone's got their eyes glued on the Federal Reserve. After Chair Jerome Powell hit the pause button on interest rates post-Wednesday's Fed meeting, the heat's on.

Trump's been banging the drum for the Fed to slash rates, and while investors are betting on cuts in September, the latest buzz says the central bank might pull the trigger sooner.

Federal Reserve Governor Christopher Waller spilled the beans in a CNBC “Squawk Box” interview on Friday, hinting that the Fed might just cut interest rates as early as July.

“I think we’re in a spot where we could do this as early as July. Whether the committee’s on board with that or not, that’s another story,” Waller said.