Wall Street Hits New All-Time Highs as US-Iran Peace Deal Takes Shape

Wall Street closed at new all-time highs on Wednesday, May 28, driven by mounting optimism over a peace agreement between the United States and Iran that would reopen the Strait of Hormuz. The S&P 500 advanced 0.6% to 7,563.63 points, surpassing the record set the previous session. The Nasdaq climbed 0.9% to 26,917.47. The prospect of restored energy flows through the world’s most critical oil chokepoint is reshaping market expectations across equities, crude, and inflation.

The Deal on the Table

President Donald Trump announced on Saturday that a peace deal with Iran is «largely negotiated» and will be disclosed shortly. The agreement, structured as a memorandum of understanding in a first phase, would pave the way for broader talks within 30 to 60 days. Its central objective: the reopening of the Strait of Hormuz to commercial shipping at pre-war traffic levels.

The strait has been largely blocked since February 28, when the United States and Israel launched an air campaign against Iran. Since then, the closure has disrupted roughly 20% of global oil trade, triggering a major energy supply shock and pushing U.S. inflation to multi-year highs.

Significant hurdles remain. Iran’s state media outlet Fars dismissed Trump’s announcement as «incomplete and inconsistent with reality,» and Tehran has insisted on permanent cessation of hostilities and the lifting of sanctions as preconditions for any deal. The nuclear program — a longstanding U.S. demand — was not addressed in Trump’s statement.

Oil: Caught Between Two Forces

Crude oil ended Wednesday below $89 per barrel, retreating as peace deal hopes gained traction. The market is caught between two opposing forces. A reopened strait would restore millions of barrels per day of blocked supply, easing the global energy crunch. At the same time, negotiations remain fragile: Iran’s Revolutionary Guard has not stood down, and sea mines laid in the strait would require months of demining before the waterway is fully navigable.

Energy analyst Stephen Schork warned that even a signed deal would not restore normal shipping before autumn at the earliest, given the technical operations required to secure the routes.

Winners and Losers on the Session

The standout move of the day belonged to Snowflake, whose shares surged 36.5% after the cloud data company confirmed that artificial intelligence continues to drive growth, with quarterly revenues and earnings that exceeded analyst forecasts. The company also signed a $6 billion multi-year deal with Amazon Web Services.

Salesforce moved in the opposite direction, falling 0.8% despite reporting better-than-expected results. Investors focused on the risk that AI-native competitors could erode its market share over the medium term.

Defense and drone-linked names also outperformed. Unusual Machines jumped 48.17%, AeroVironment gained 15.51%, and Kraton Defense advanced 14.15%, reflecting continued investor appetite for companies tied to the conflict economy.

What the Market Is Pricing In

Equities are trading as if a deal is likely but not certain. The S&P 500 is at record levels even as the Strait of Hormuz remains closed — a signal that markets are looking through the current disruption toward a post-conflict normalization of energy supply and inflation. The sessions ahead will be defined by any formal joint statement from Washington and Tehran, the reaction in oil prices, and Federal Reserve guidance — a sustained drop in crude would accelerate the path to rate cuts and add a second tailwind to risk assets.