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Oil Prices Pare Gains After Report of Iran Deal
Stock Market Is Heading Toward Records
| Updated:
Key Takeaways:
- Global stocks declined as U.S. defensive strikes on Iran and ongoing uncertainty about a potential deal dampened investor sentiment.
- Axios reported the U.S. and Iran have reached a deal to extend a truce,
- U.S. markets recently hit record highs, supported by strong corporate earnings and lower fuel costs benefiting travel and transportation companies.
NEW YORK — The U.S. stock market is pushing to more records May 28 as companies like Dollar Tree, Snowflake and Hormel Foods keep piling up profits. That's even as oil prices continue to swing and more data shows pressure building on the economy because of the war with Iran.
Axios reported the U.S. and Iran have reached a deal to extend a truce and work toward an agreement to end the war, Bloomberg reported. President Donald Trump still needs to approve the terms, it said.
The S&P 500 added 0.5% to its all-time high set the day before after drifting between small gains and losses earlier in the morning. The Dow Jones Industrial Average was down 10 points, or less than 0.1%, as of 1:26 p.m. Eastern time, and the Nasdaq composite was 0.8% higher after both indexes also set records the day before.
Even with worries about expensive oil and high inflation, the U.S. stock market has run to records largely because U.S. companies keep making more money. Stock prices tend to follow the path of corporate profits over the long term, and companies have been routinely topping analysts' expectations for the first three months of 2026.
Dollar Tree’s stock soared 19% after it became the latest to report fatter profit than analysts expected. CEO Mike Creedon said improved store conditions helped the retailer make more profit off each $1 in sales during the latest quarter despite tariffs adding to its costs. The company also gave a forecast for profit over the full year that topped analysts’ expectations.
Kohl’s rallied 18.9% after the retailer reported better results for the latest quarter than analysts had feared, while Best Buy climbed 18% following its own better-than-expected profit report. Hormel Foods climbed 13.1% after a strong performance for its Jennie-O ground turkey and exports of its Spam luncheon meat helped it report a better profit than analysts expected.
Snowflake rose 38.8% after saying artificial intelligence continues to be a strong driver of its business, and profit and revenue for the latest quarter exceeded expectations.
They helped offset a dip for Marvell Technology, which fell 1.3% after its profit for the latest quarter only matched analysts' expectations. It also said AI is driving big revenue growth for it, particularly its data center business.
The latest threat to the ceasefire in the war came after U.S. Central Command said Kuwait had intercepted missiles launched by Iran late May 27. That followed earlier “defensive” strikes by the U.S. military on missile launch sites and minelaying boats in southern Iran.
In the bond market, Treasury yields eased after a report said the measure of inflation that the Federal Reserve likes to use accelerated last month but was roughly within economists’ expectations.
The yield on the 10-year Treasury fell to 4.46% from 4.48% late May 27 after giving up an earlier gain.
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The yield on the 10-year Treasury fell to 4.46% from 4.48% late May 27 after giving up an earlier gain.
Data also showed how U.S. households are less able to save money, with the personal savings rate down to a four-year low of 2.6%, “pointing up the financial pressure on lower- and middle-income families,” according to Gary Schlossberg, global strategist at Wells Fargo Investment Institute.
U.S. households have been saying they’re feeling discouraged about the economy and inflation, even as the stock market keeps chugging along.
High yields in bond markets worldwide recently have threatened to slow economies and undercut prices for stocks and all kinds of other investments. High yields have already forced the average long-term U.S. mortgage rate to its most expensive level since last summer, and they could curtail companies’ borrowing to build the AI data centers that have supported the U.S. economy’s growth recently.
A report on May 28 said the pace of sales of new U.S. homes unexpectedly slowed last month, as the weight of higher mortgage rates hurts the market.
In stock markets abroad, indexes dipped across much of Europe and Asia. Hong Kong’s Hang Seng fell 1.3% for one of the world’s larger losses.
AP Business Writer Elaine Kurtenbach contributed to this report.
