The Iran oil deal appears set to take effect on Friday, with no reversals from either side reported so far, according to CNBC. The memorandum of understanding for the Iran conflict is holding, and the signing in Geneva is approaching. Oil sanctions relief for Iran is expected to take effect immediately after the agreement is signed, as reported by people familiar with the matter [1]. Despite some complaints from Congress that President Trump should seek their signoff on the deal, no major obstacles have emerged [1].
The anticipation of increased oil supply has already impacted markets. Brent crude futures fell 5% to close at $78.96 per barrel, marking the first time the benchmark has dropped below $80 since March. U.S. West Texas Intermediate futures also declined by 5.8% to settle at $76.05 [1]. This drop in oil prices reflects investor optimism about future supply conditions.
Equity markets responded positively to the developments. The Dow Jones Industrial Average reached a record high of 51,999.67 as investors rotated out of chipmakers and into cyclical stocks. However, the S&P 500 and Nasdaq Composite fell, with notable declines in Advanced Micro Devices (down more than 7%), Micron Technology (down 6%), and Nvidia (down more than 2%) [1].
SpaceX was a standout performer, becoming the fifth most valuable U.S. company. Its market capitalization reached $2.94 trillion in mid-morning trading, surpassing Microsoft's $2.93 trillion, before ending the day at $2.65 trillion [1]. Despite this surge, Michael Burry expressed skepticism about SpaceX's valuation, noting its annual revenue is less than $20 billion and describing it as a 'fundamentally a small space company, a niche telecom, a bedeviled social media company, and a Coreweave-light' [1].
In the chip sector, Intel began production of its most advanced chip node, 18A-P, at the VLSI Symposium in Honolulu. This development brings Intel closer to a potential deal to manufacture chips for Apple devices. Analyst Ben Bajarin commented that Apple is likely to wait before adopting the 18A-P node. Intel shares rose nearly 14% last month on related reports [1].
CONCLUSION
The imminent Iran oil deal has driven optimism in equity markets and pushed oil prices lower, with the Dow hitting a record high. SpaceX's valuation surge and Intel's chip progress were also key highlights, though some skepticism remains about SpaceX's fundamentals. Overall, the market response has been positive, reflecting expectations of increased oil supply and sector rotation.