U.S. stock index futures rallied in after-hours trading on Tuesday following signals from President Donald Trump and Iranian officials that a short-term ceasefire may be possible. The announcement that planned U.S. strikes have been delayed by two weeks to allow negotiations to proceed prompted sharp gains in futures and a steep drop in oil prices.
By 19:38 ET (23:38 GMT), S&P 500 Futures had risen 2.2% to 6,804.75 points. Nasdaq 100 Futures gained 2.7% to reach 25,029.50 points, and Dow Jones Futures were up 2% at 47,760.0 points. At the same time, crude oil prices tumbled by over 12% in response to the de-escalatory signals.
Political developments that moved markets
President Trump said on Tuesday evening that he would suspend planned military strikes on Iran for two weeks, citing an opportunity to broker a ceasefire after diplomatic efforts led by Pakistan. Trump indicated the United States is open to stopping further hostilities against Iran, provided that Tehran re-opens the Strait of Hormuz.
He added that a ceasefire agreement would be worked out in the coming weeks. The President framed the delay as occurring just hours before a late-Tuesday deadline for severe attacks on Tehran and credited Pakistani diplomacy for enabling the temporary de-escalation.
Iran’s Foreign Minister, Seyed Aragchi, said Tehran would stop its "defensive operations" if attacks against the country were halted, and that safe passage through the Strait of Hormuz would be possible. Despite the statements pointing toward a pause, hostilities between Iran, Israel and neighboring Gulf states continued into late-Tuesday, and the conflict had entered its sixth consecutive week.
Onshore market session: muted gains, chipmakers lead
Earlier in the trading day, U.S. equities were largely subdued, with sector rotation producing uneven results. The S&P 500 closed up 0.1% at 6,616.84 points, and the NASDAQ Composite also finished 0.1% higher at 22,017.85 points. The Dow Jones Industrial Average declined 0.2%, closing at 46,584.46.
Semiconductor stocks were the brightest spot, helping the Philadelphia Semiconductor Index (SOX) jump by more than 1%. Broadcom Inc experienced a rally after expanding an artificial intelligence chips agreement with Google and Anthropic. NVIDIA Corporation advanced 0.3% and Intel Corporation rose 4.2%, while other chipmakers saw some bargain buying after steep losses in March.
Traders noted that April trading had shown tentative gains as bargain hunters returned following a notable sell-off in March. Still, mixed signals on the possibility and durability of a U.S.-Iran ceasefire kept volatility elevated as market participants weighed the likelihood that hostilities could truly be paused.
Implications for markets and commodities
- Equity futures responded positively to the temporary de-escalation, signaling potential near-term upside should negotiations hold.
- Energy markets reacted sharply to the expectation of lower supply risk, with oil prices falling more than 12% on the ceasefire signals.
- Semiconductor names outperformed in the cash session, supported by sector-specific developments and bargain-driven flows.
While the after-hours moves reflected renewed hope for a diplomatic resolution, the continuation of hostilities late on Tuesday kept uncertainty elevated. Market participants remained focused on whether the announced pause would lead to a negotiated cessation of attacks or whether fighting could resume.