New York, March 23, 2026, 17:35 EDT
Stocks bounced back Monday as oil tumbled below the $100 mark, following President Donald Trump’s comments on “productive” U.S.–Iran talks and a five-day pause on planned strikes against Iranian power facilities. The Dow surged 631 points by the bell, the S&P 500 rose 1.1%, and the Nasdaq picked up 1.4%. Brent crude fell to $99.94 a barrel. 1
Investors had steeled themselves for a harsher energy jolt after the Strait of Hormuz was essentially closed off. Roughly 20% of the world’s oil and LNG supply passes through these waters. Just the hint of a disruption sent Treasury yields sliding, put pressure on the dollar, and funneled cash back into equities. 1
Trump said that his envoy Steve Witkoff and adviser Jared Kushner held talks with Iranian officials on Sunday, and those conversations carried on into Monday. According to him, they’ve already lined up “major points of agreement.” The five-day pause, he added, will test if the negotiations are enough to forge a broader deal aimed at ending the war. 2
The backlash followed quickly. Tehran dismissed any suggestion of direct or indirect negotiations with Washington, while parliament speaker Mohammad Baqer Qalibaf labeled Trump’s version “fake news” designed to swing oil and financial markets. Still, according to Reuters, Egypt, Pakistan, and several Gulf nations were relaying messages between the two sides. 3
Relief buying caught on quickly. The STOXX 600 in Europe snapped back to a 0.6% gain after falling as much as 2.5% earlier. Travel stocks like Air France-KLM and Lufthansa jumped, while oil majors BP and Shell dropped alongside tumbling crude prices. Stateside, small caps took the spotlight, lifting the Russell 2000 by 2.3%. 4
Tim Ghriskey, senior portfolio strategist at Ingalls & Snyder in New York, put it bluntly: “you never know who to believe,” but the bounce suggested investors saw at least a slim possibility Trump was angling to open a path out of the conflict. Steven Englander, who heads global G10 FX research and North America macro strategy at Standard Chartered, noted that markets weren’t calling an all-clear, just recognizing that the likelihood of the worst-case scenario hitting in the next few days had dropped. 5
Traders dusted off the “TACO” acronym—short for “Trump Always Chickens Out”—as the reversal put bets back on that Trump would ease off tough talk if markets took a hit. Reuters noted last year that a Financial Times columnist first coined the phrase amid the tariff drama. In a markets note Monday, Reuters pointed out some investors saw Trump’s latest pause as yet another buy signal. 6
Fiona Cincotta, senior market analyst at City Index, called Trump’s remarks “exactly what the market needed to hear” to shake off worst-case fears. Still, she noted, the move higher won’t stick without buy-in from Iran. Monex Europe’s Nick Rees, head of macro research, saw Trump angling for an exit ramp, but said uncertainty definitely lingers. 7
Plenty could still unravel. Fighting dragged on Monday, with Tehran announcing new strikes, and the Strait of Hormuz stayed mostly shut. Analysts caution that fixing oil and gas supply chains might take months—even if diplomacy actually gets somewhere. Susannah Streeter at Wealth Club called relying on President Trump’s statements “fraught with risks.” Ipek Ozkardeskaya of Swissquote pointed out that Iranian cooperation—not just U.S. moves—will be crucial. 3
Since fighting broke out Feb. 28, Reuters tallies put the death toll north of 2,000. Markets have felt the aftershocks for almost a month. On Monday, International Energy Agency chief Fatih Birol called this crisis more severe than both 1970s oil shocks together—making clear that Monday’s rebound reflected nerves easing, not the end of the trouble. 2
