Risk assets moved higher after U.S. Treasury Secretary Scott Bessent said the United States and Iran could reach an agreement as early as Wednesday to reopen the Strait of Hormuz, lifting expectations for a recovery in energy shipments and supporting gains in U.S. and Asian markets.
In an interview, Bessent said the goal of any agreement would be to ensure “freedom of passage” through the strait. Asked whether Iran might charge ships passing through the waterway, he said, “This will be a matter of freedom of navigation.”
Hormuz reopening becomes a key market focus
Before the war broke out, about 20% of global oil shipments passed through the Strait of Hormuz. U.S. Central Command said the southern shipping lane in the strait remains open and that all commercial vessels can continue to transit.
Even so, uncertainty remains in U.S.-Iran relations. According to the report, Iran accused the Trump administration of potentially “lighting the fuse for World War III.” The United States had previously warned Iran that the current moment was the “last chance” to reach a deal.
Investors also watch earnings and AI capex
Beyond the geopolitical developments, investors were also focused on technology earnings and the scale of AI-related capital spending.
SpaceX, in its first earnings report since going public, posted second-quarter revenue above expectations. Still, a surge in capital expenditures raised concerns, and the stock fell about 7% at one point in after-hours trading. The company reported $18.4 billion in second-quarter capex, with roughly $16 billion allocated to AI computing infrastructure.
AMD also reported second-quarter results above market expectations, but its capital expenditures rose to $808 million from $282 million in the same period last year. Its shares also moved lower after hours.
The report said the market is reassessing whether large-scale spending by technology giants can quickly translate into revenue growth as investment in AI infrastructure accelerates. Paramount Skydance also raised its full-year profit guidance after revenue beat Wall Street expectations and its streaming business posted growth.