Markets Rip Higher on Exit Hopes, but Oil Keeps the Risk Alive | Daily Recap: March 31, 2026

U.S. Markets Surge on Iran War Exit Hopes, Best Day in 10 Months

U.S. equities exploded higher Tuesday with the Dow soaring over 1,100 points and the Nasdaq surging 3.6%, as reports that Trump is willing to end the military campaign against Iran—even if the Strait of Hormuz remains largely closed—sparked the biggest relief rally in nearly a year.

Primary Catalyst: Iran War Exit Signals Ignite Relief Rally

A report indicating Trump is willing to end Operation Epic Fury even without full Hormuz reopening sent markets sharply higher, with all three major indexes posting their best single-session gains in months. Trump suggested the war won't last "much longer," driving broad-based buying across growth and cyclical sectors. However, oil held above $112 per barrel and the Strait of Hormuz remained largely closed, with analysts warning the "danger zone" is $125+ oil sustained for more than a month.

Macro Context: Ugly Quarter Ends on a High Note

March was the worst month for U.S. equities since September 2022, with the S&P 500 down ~9.3% and oil surging 53% over the quarter. JOLTS data showed a "low-hire, low-fire" labor market backdrop, while consumer sentiment continued to cool. Fed officials remain in wait-and-see mode, with Powell's "look past energy prices" stance providing a policy floor.

Sector Performance (NASDAQ)

Investor Takeaway

The rally's durability hinges on whether Trump's peace signals translate into a genuine cease-fire. Friday's jobs report will be critical—a weak print could revive recession fears even as geopolitical optimism builds. Oil above $112 and a still-closed Strait of Hormuz remain the key variables to watch heading into April.