Wall Street stock indexes opened higher on Monday, while the FTSE 100 (^FTSE) and European stocks staged a stellar recovery, surging from lows earlier in the session, after Donald Trump signalled that the US and Iran have had “very good and productive conversations” over “total resolution” of hostilities.
He said the US would postpone all military strikes against Iranian power plants and energy infrastructure for five days.
Posting on his Truth Social he said: “I AM PLEASED TO REPORT THAT THE UNITED STATES OF AMERICA, AND THE COUNTRY OF IRAN, HAVE HAD, OVER THE LAST TWO DAYS, VERY GOOD AND PRODUCTIVE CONVERSATIONS REGARDING A COMPLETE AND TOTAL RESOLUTION OF OUR HOSTILITIES IN THE MIDDLE EAST. BASED ON THE TENOR AND TONE OF THESE IN DEPTH, DETAILED, AND CONSTRUCTIVE CONVERSATIONS, WITCH WILL CONTINUE THROUGHOUT THE WEEK, I HAVE INSTRUCTED THE DEPARTMENT OF WAR TO POSTPONE ANY AND ALL MILITARY STRIKES AGAINST IRANIAN POWER PLANTS AND ENERGY INFRASTRUCTURE FOR A FIVE DAY PERIOD, SUBJECT TO THE SUCCESS OF THE ONGOING MEETINGS AND DISCUSSIONS. THANK YOU FOR YOUR ATTENTION TO THIS MATTER! PRESIDENT DONALD J. TRUMP”
It comes as markets were deep in the red after Trump threatened to hit Iran’s electricity grid unless it allows oil tankers to travel safely again along its coastline. The US president gave Tehran until the end of today to reopen the Strait of Hormuz or risk strikes on the country’s power generation facilities.
Read more: Oil prices gain as Trump and Starmer discuss need to reopen Hormuz
Analysts hailed the “Taco” moment in the conflict, referring to the popular trading acronym that stands for “Trump Always Chickens Out”.
“It appears that, yes, they do eat Tacos in Tehran – at least if Trump’s social media is anything to go by,” said Michael Brown, an analyst at Pepperstone.
“This is clearly a positive development. The two sides are in discussions, and this is the first material sign of de-escalation that we have seen since conflict broke out at the end of February.
“The war is not yet over. While positive, it is only strikes on energy infrastructure that have been ruled out at this stage, presumably meaning that kinetic action will continue elsewhere, at least for the time being.”
“There are caveats. Trump notes in his post that the five day pause will be contingent on the success of ‘ongoing meetings and discussions’, meaning that things could escalate once more, if talks were to fall apart.”
Read more: Gold and silver erase 2026 gains as Middle East inflation fears stoke bets on higher interest rates