A trader work on the floor of the New York Stock Exchange during morning trading on May 20, 2026 in New York City.
Michael M. Santiago | Getty Images
Stocks jumped on Wednesday as oil prices and U.S. Treasury yields slid amid growing optimism that the conflict in the Middle East could soon be resolved. Traders also looked ahead to the release of Nvidia’s first-quarter earnings report.
The Dow Jones Industrial Average advanced 645.47 points, or 1.31%, closing at 50,009.35. The S&P 500 rose 1.08% to 7,432.97, while the Nasdaq Composite added 1.54% and ended at 26,270.36.
West Texas Intermediate futures shed 5.66% to close at $98.26 per barrel. Brent crude pulled back 5.63% to settle at $105.02 a barrel. That’s after President Donald Trump told reporters the administration was in the “final stages” of negotiations with Iran, per a pool report.
Treasury yields also cooled following the developments. The 10-year Treasury yield dropped more than 9 basis points on Wednesday, and the 30-year Treasury yield shed more than 6 basis points. One basis point equals 0.01%.
U.S. 10-year Treasury
The bond market spooked investors in recent days, as the 30-year yield hit its highest level since 2007, and the 10-year yield neared multi-year highs. There is growing concern that inflation is reigniting because of higher oil prices and that the Federal Reserve, soon to be led by Kevin Warsh, is behind the curve in fighting it. The rise in rates could derail an economy already under threat from higher energy costs.
Minutes from the latest Fed meeting showed that most officials expected interest rate hikes down the line if the Middle East conflict continued to exacerbate inflation, saying: “A majority of participants highlighted, however, that some policy firming would likely become appropriate if inflation were to continue to run persistently above 2 percent.”
Investors are also turning their attention toward Nvidia, which reports its first-quarter earnings after the close. The report will be an important view into the artificial intelligence trade and provide the latest update on demand for chips. Shares of the company were up more than 1%.
“Nvidia is the most important AI stock, and since so much of the stock market’s gains over the past few years have been driven by the incredible capabilities of AI, the outcome of Wednesday’s earnings report means everything for this market,” said James Demmert, chief investment officer at Main Street Research.
The stock has risen nearly 20% this year, and Demmert noted that while there is skepticism built into the chipmaker and AI darling, especially given its massive run of more than 1,400% in the last five years, expectations are “somewhat muted” going into the report.
“The sticking points in Nvidia’s earnings report are any signs of margin compression due to rising memory prices, along with how the company is navigating sales in China,” he added.