US stocks rebound, Dow jumps 200 after Trump says Iran war ‘very complete’

US stock indices reversed sharply into the green on Monday after President Donald Trump told CBS News senior White House correspondent that the US-Israel war against Iran is effectively over.

The Dow Jones Industrial Average, which had plunged as many as 945 points in the morning session, rebounded sharply and closed nearly 240 points up at 47,740.74.

The S&P 500 was 0.8% higher at closing time, while the Nasdaq Composite closed at 22,695.94, up 1.38% from its previous close.

US stock stage dramatic reversal

The comment came without warning and without a formal press conference.

In a brief phone interview, President Trump said:

"I think the war is very complete, pretty much. They have no navy, no communications, they've got no Air Force."

He added that the United States is "very far" ahead of his original four-to-five week timeline for Operation Epic Fury.

The operation began ten days ago with strikes targeting Iran's missile infrastructure, naval assets, and command-and-control capabilities.

The remarks came as big relief for markets as the investors remain on edge amid skyrocketing oil prices.

Oil, which had been trading above $100 per barrel for the better part of the session and was the primary driver of the morning's stagflation panic, began pulling back sharply.

The speed of the reversal underscored just how much of Monday's selling was driven not by fundamental deterioration but by geopolitical fear.

The February jobs report, which showed the economy shedding 92,000 positions against forecasts of a 50,000 gain, was already bad enough on its own.

Layered on top of a shooting war that had pushed oil above $100, it had created a near-perfect stagflation narrative.

Trump's comment dismantled the oil-driven half of that narrative in a single post.

Relief, not resolution

But a quote to a news reporter is not a declaration of a ceasefire.

Trump has consistently framed the war's end as conditional on Iran's "unconditional surrender," and as recently as Sunday, he described the spike in energy prices as "a very small price to pay" for eliminating the Iranian nuclear threat.

The US military has struck more than 3,000 targets during Operation Epic Fury, but whether that constitutes a concluded campaign or a paused one remains unclear.

Markets are trading the comment at face value for now.

Oil's retreat from its $100-plus highs has done the immediate work of releasing pressure from the inflation side of the stagflation equation.

If crude continues to pull back, it can have be a huge relief for the Fed's policy calculas, which is currently frozen between cutting rates to cushion a weakening labour market and holding firm to contain inflation.

Tuesday's open is going to be very crucial as it will reveal if Trump's remarks are taken seriously or if investors were just looking for a chance to stop selling.