US stocks bounce back: S&P 500, Nasdaq climb 0.5% amid Iran escalation

US stocks rebounded on Wednesday, with the S&P 500 up 0.3% and the Nasdaq Composite gaining 0.5%, a day after Iran's escalating conflict with Israel and the US sent major indexes sharply lower.

The Dow Jones Industrial Average rose 180 points, or 0.4%.

Investors weighed Treasury Secretary Scott Bessent's assurances on oil shipments through the Persian Gulf against the prospect of new 15% global tariffs set to take effect this week.

Israel kept the pressure on with fresh strikes near Tehran, while Trump's team vowed Navy escorts for tankers in the Strait of Hormuz, the narrow chokepoint for 20% of global oil flows.

Escalation risks stayed high, but Treasury Secretary Scott Bessent's comments on oil stability and tariff details helped calm some nerves.

Oil prices pulled back from peaks, with Brent down 0.7% and WTI off 1%.

Bessent's dual punch: Oil flow and tariff timeline steadies nerves

Bessent went straight at the energy panic.

He promised a "series of announcements" to backstop oil tanker insurance and get traffic moving through Hormuz again, moves that could blunt the supply squeeze from IRGC threats and recent attacks.

That talk mattered as oil had spiked on war fears, but the prospect of US support trimmed the premium fast.

On tariffs, he laid out a timeline: a new 15% global levy kicks in later this week, but with eyes on a rollback "within 5 months" after the Supreme Court's smackdown on an earlier plan.

It's classic Bessent: clear rules amid chaos.​

The analysts point out that markets remain highly sensitive to geopolitical headlines, but stabilizing energy prices could create longer-term buying opportunities.

Volatility cuts both ways, and today's bounce shows buyers hunting value in the noise.​

Wall Street's split: War risk vs. policy lifeline

The split screen was stark. Geopolitics screamed sell: Israel vowing to "crush" Iran's regime, Hormuz tankers still halted, and no clear off-ramp in sight.

Europe clawed back too: Stoxx 600 up on the day, but energy stocks lagged as the sector digested the Bessent buffer.

Semis and tech led the Nasdaq lift, betting policy lifelines outweigh war headlines for now.

Some analysts say that while geopolitical tensions continue to dominate headlines, easing energy prices could create selective buying opportunities for investors willing to tolerate volatility.

However, they caution that risks remain elevated, with the potential for sudden escalation in the Gulf region likely to keep markets sensitive to new developments and shipping disruptions.

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