US stocks: Wall Street rebounds as oil drops despite Middle East tensions

Published Tue, May 5, 2026 · 10:46 PM

WALL Street’s main indexes recovered on Tuesday as oil prices fell despite renewed Middle East tensions that threatened to upend a fragile truce after the US and Iran exchanged fire ​in the Gulf.

Markets have been volatile, caught between heightened geopolitical tensions and a strong domestic backdrop – the S&P 500 and the Nasdaq hit record highs in recent sessions on resilient earnings and economic momentum – and equities are vulnerable to sudden reversals as new and sometimes conflicting headlines emerge.

“Earnings have been better than expected, which has been great, considering the valuations. You need the earnings to support where you are,” said Joe Saluzzi, co-head of equity trading at Themis Trading.

“There are certainly big issues out there that I think the market is overlooking and that might come back to haunt us.”

Crucially, the Strait of Hormuz oil shipping route remains disrupted. Brent crude futures lost 1.6 per cent but were still trading above US$110 a barrel.

At 10.01 am ET, the Dow Jones Industrial Average rose 250.95 points, or 0.51 per cent, to 49,192.85, the S&P 500 gained 47.98 points, or 0.67 per cent, to 7,248.73, and the Nasdaq Composite added 206.72 points, or 0.83 per cent, to 25,274.52.

Nine of the 11 main S&P sectors were in the green, with S&P 500 consumer discretionary leading gains with a 1.21 per cent jump.

As a net energy exporter, the US has so far held up better than several other economies. However, BlackRock Investment Institute analysts led by global chief investment strategist Wei Li said in a note that “even US equities won’t be insulated” if the Strait of Hormuz does not open.

Data released on Tuesday showed US job openings fell to 6.866 million in March, but were slightly above the 6.835 million estimate, reinforcing the view that labour market resilience could give the Federal Reserve room to keep interest rates higher for longer.

The Institute for Supply Management’s non-manufacturing purchasing managers’ index for April came in at 53.6, also narrowly missing the estimate of 53.7, according to economists polled by Reuters.

Meanwhile, Intel climbed 9.4 per cent after Bloomberg News reported Apple had held exploratory discussions about using Intel and Samsung Electronics to produce the main processors for its devices.

Grain trader Archer-Daniels-Midland rose 5.8 per cent after reporting better-than-expected first-quarter profit on higher margins.

DuPont gained 8 per cent after the industrial materials maker lifted its annual profit forecast.

Shares of Pinterest jumped 14 per cent after the image-sharing platform forecast second-quarter revenue above analysts’ estimates.

Advancing issues outnumbered decliners by a 2.22-to-1 ratio on the NYSE and by a 1.43-to-1 ratio on the Nasdaq.

The S&P 500 posted 34 new 52-week highs and 19 new lows, while the Nasdaq Composite recorded 98 new highs and 50 new lows. REUTERS