US Stocks Rally on Iran Ceasefire Talks as PCE Cools; Europe Slips — May 28, 2026 Market Wrap

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Wall Street staged a dramatic intraday reversal on Thursday, May 28, closing firmly higher after early losses driven by fresh US airstrikes near Iran’s Strait of Hormuz gave way to optimism over a potential 60-day ceasefire framework. European markets, which closed before Washington fully confirmed the deal, finished solidly in the red.

US Markets: A Full Reversal Powered by Ceasefire Reports

US equity futures were deep in the red before the opening bell after the US carried out additional strikes on Iranian positions near the Strait of Hormuz overnight — pushing oil prices sharply higher and stoking fears of a prolonged supply disruption. The mood flipped decisively mid-session as credible reports emerged that Washington and Tehran had tentatively agreed on a 60-day ceasefire framework, including the reopening of Hormuz to commercial shipping and a restart of nuclear negotiations under IAEA supervision. According to Proactive, the deal still required formal approval from President Trump, which kept celebration muted — but it was enough to turn markets around.

By the closing bell:

  • S&P 500: 7,563.63 (+43.27 / +0.58%)
  • Dow Jones Industrial Average: 50,668.97 (+24.69 / +0.05%)
  • Nasdaq Composite: approximately 26,917 (+243 / +0.91%), with technology and growth names leading the charge

April PCE Inflation: Cooler Than Expected, But Still Elevated

Thursday also brought the Federal Reserve’s preferred inflation gauge: April PCE (Personal Consumption Expenditures) data came in lower than expected, although prices remain elevated. Personal spending growth slowed to roughly half the prior month’s pace, and Q1 GDP was revised lower — painting a picture of an economy that is cooling but not yet at the pace needed to unlock rate cuts. The data offered modest relief without materially shifting the Fed’s calculus. Monitor the policy outlook via the Federal Funds Rate tracker on ECONPLEX.

European Markets: Caution Prevails

Europe’s major indices were unable to share in Wall Street’s recovery. The session closed before the ceasefire deal had gathered enough momentum to fully reassure investors, and the FTSE 100 fell 79 points, or 0.75%, to 10,425.96. Most sectors — from utilities and retailers to banks and consumer names — finished lower. MT Newswires reported that defense stocks were among the session’s rare gainers, rising on the back of sustained geopolitical tension.

London stocks did briefly trim losses in the afternoon after reports of the ceasefire proposal broke, but could not fully recover. Proactive’s live blog noted that UK utilities, retailers, banks, and consumer names were “all firmly in the red with less than half an hour of trading to go,” as the market held out for concrete confirmation of the deal.

Germany’s DAX also declined, closing at 25,092.25, while broader European markets reflected similar risk-off behavior ahead of the US market’s ultimate recovery.

Macro Variables in Focus

  • Brent crude: Surged at the open on Iran strike news, then pulled back toward $95/barrel by mid-afternoon London time as the ceasefire deal narrative gained traction. Track Brent crude on ECONPLEX.
  • Bond yields: US Treasuries and UK gilts both saw demand rise during the session, sending yields lower. The UK 10-year gilt fell to its lowest level in roughly six weeks, according to Proactive.
  • VIX: The fear gauge pulled back as the ceasefire narrative gained ground, reflecting reduced near-term uncertainty in US markets.
  • Snowflake (SNOW) earnings: After the closing bell, Snowflake reported a strong Q1 result alongside a major AWS partnership deal. The stock surged in after-hours trading, adding a positive note to the tech sector’s outlook heading into Friday.

What Asian Investors Should Watch on May 29

  1. Iran deal confirmation: The 60-day ceasefire framework still awaited formal Trump approval as of Thursday’s close. Confirmation would likely lift risk sentiment across Asia — and accelerate the decline in oil prices. A breakdown would reverse Thursday’s US gains.
  2. Oil prices and inflation linkage: A sustained drop in Brent crude from the current elevated levels would offer additional disinflationary relief globally, supporting the case for regional rate easing.
  3. Tech sentiment: Snowflake’s after-hours surge, combined with the Nasdaq’s 0.91% gain on the session, may provide positive momentum for Korea’s tech-heavy markets. Monitor KOSPI and KOSDAQ on ECONPLEX.
  4. PCE and Fed rate path: April PCE below expectations is a constructive signal for eventual Fed easing, but not a catalyst for imminent action. Check upcoming Fed-relevant events on the Economic Calendar.

Sources:

Track the data behind today’s moves: Monitor real-time indicators including the S&P 500, Brent crude, and the Federal Funds Rate on ECONPLEX. Stay ahead of market-moving events with the Economic Calendar.

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