The main U.S. equity indexes gapped down at the opening bell after President Donald Trump told the American people the U.S. would achieve its military objectives in the Middle East "very shortly," but would also hit Iran "extremely hard over the next two to three weeks." Stocks rallied off their morning lows on reports the Islamic Republic is working with Oman on a plan to open the Strait of Hormuz. Crude oil soared early and sagged late, as the recent pattern for price action continues.
"I was surprised that President Trump did not hint at an exit plan for the war in Iran in last night’s speech," Mizuho Securities Director of Futures Bob Yawger writes. "Instead, the President doubled down on the concept of blasting Iran to submission." Indeed, as Yawger notes, markets expected Trump "to paint a picture that would allow the U.S. to leave the Middle East in a reasonably short period of time."
