MARKET SNAPSHOT

U.S. stocks and oil futures ticked higher ahead of a Tuesday night deadline President Trump has set for Iran to reopen the Strait of Hormuz to tanker traffic or face a new wave of attacks on its power plants and bridges. Treasury yields settled close to Friday's levels amid uncertainties raised by the war in Iran. Gold edged higher as the dollar weakened.

MARKET WRAPS

EQUITIES

U.S. stocks continued to rebound, with investors awaiting clarity on whether the Middle East war will pause or intensify in the coming days.

Over the long weekend, the Trump administration pushed for a potential 45-day cease-fire with Iran while President Trump continued posting escalatory rhetoric on social media. The president said the U.S. would bomb civilian infrastructure in Iran if a deal to reopen the Strait of Hormuz wasn't reached by Tuesday evening.

Then, on Monday, Iran rejected a U.S. plan to end the war, issuing its own 10-point response via Pakistan, according to Iran's state news agency IRNA. Trump responded that Iran's counterproposal wasn't good enough for a cease-fire, but that "it's a significant step."

Some investors say they still remain hopeful that Iran and the U.S. will reach a resolution before rising oil prices begin hurting the economy. Trump said later in the press conference that Iran is "an active, willing participant" in wanting to reach a deal.

The Dow Jones Industrial Average rose 0.4%. The Nasdaq composite gained 0.5% and the S&P 500 added 0.4%, with both indexes marking their best four-day run since last May.

"We're going into this with a glass-half-full perspective," said Eric Freedman, chief investment officer at Northern Trust Wealth Management.

Earlier Monday, Japan's Nikkei Stock Average gained 0.5%, led by chip and retail stocks.

South Korea's Kospi added 1.4% for its second consecutive session, led by advances at Samsung Electronics.

Markets in China were closed in observance of the Ching Ming Festival.

Markets in Australia and New Zealand were closed in observance of Easter Monday.

COMMODITIES

Oil futures posted modest gains as President Trump reiterated Tuesday's 8 p.m. ET deadline for Iran to reach a deal to end the Middle East conflict--one that includes opening the Strait of Hormuz.

Prices gave back some gains as Trump said the U.S. has "an active willing participant" on the other side in negotiations and that he doesn't want to destroy Iran's civilian infrastructure. But if a deal isn't reached, the U.S. has a plan to destroy every bridge and power plant in Iran, Trump added.

"The market is very headline sensitive and is currently torn between reports a cease-fire is at hand versus President Trump's vow to attack Iranian infrastructure if the Iranians do not open the Strait of Hormuz by Tuesday," Mizuho's Robert Yawger said.

WTI for May delivery settled up 0.8% at $112.54 a barrel. June Brent rose 0.7% to $109.77.

Front month Comex gold for April delivery gained 0.11% to settle at $4656.80 per troy ounce.

TODAY'S TOP HEADLINES

U.S. to Escalate Iran Strikes as Deadline for Strait of Hormuz Looms

President Donald Trump praised the successful rescue of two U.S. aviators shot down over Iran and reiterated his threat on Iran during a Monday afternoon White House briefing.

"The entire country can be taken down in one night and that night might be tomorrow night," he said. If no deal is reached with Iran to end the war and open the Strait of Hormuz, "they're going to have no bridges. They're going to have no power plants," he said. That could be accomplished in four hours, Trump added.

Meanwhile, Defense Secretary Pete Hegseth said that Monday's strikes would be the highest volume since the war began on Feb. 28 and Tuesday would bring even more.

Medicare Insurer Payments to Rise 2.48% in 2027, Higher Than Some Analysts Expected

The Trump administration will raise payments to Medicare insurers by 2.48% next year, a significant improvement for the health-insurance industry after an earlier proposal torpedoed shares of the largest companies.

The final 2027 rates for the Medicare Advantage program came in above some analysts' expectations. Several had suggested a rate increase would likely be finalized at around 1% or slightly higher, with a "bull" case closer to 2% to 3%. The January proposal would have held rates roughly flat.

"These updates keep coverage affordable and ensure patients get real value from their plans," said Mehmet Oz, administrator of the Centers for Medicare and Medicaid Services.

U.S. Services Sector Faced Heightened Inflation in March

Inflation pressures facing U.S. services firms were the greatest in four years last month as the war in Iran pushed up energy prices, a survey of managers found.

The prices index in the Institute for Supply Management's survey of purchasing executives in the services industry rose to 70.7, from 63 a month earlier. Values over 50 indicate firms are facing rising prices. It was the index's largest one-month increase in 13 years.

"The war in Iran has added an additional layer of uncertainty on top of an already shaky macroeconomic climate," a manager from the real-estate industry told the survey. "A spike in inflation due to higher oil prices will reduce purchasing power, affecting every industry."

Gulf Funds Agree to Back Paramount's $81 Billion Takeover of Warner

Paramount has received signed equity commitments of close to $24 billion from three sovereign-wealth funds led by Saudi Arabia to help back its takeover of Warner Bros. Discovery, according to people familiar with the matter.

Saudi Arabia's Public Investment Fund has agreed to provide roughly $10 billion of the nearly $24 billion to Paramount, run by David Ellison, the son of billionaire Oracle co-founder Larry Ellison.

The agreements with investors also include Qatar Investment Authority and Abu Dhabi's L'imad Holding Co., the people said.

BNY, Robinhood Win Contract for Running Trump Accounts

Bank of New York Mellon and Robinhood are the early winners in Wall Street's race to play a role in setting up and running Trump accounts, a new savings tool for children created under last year's tax law.

The Treasury Department is announcing Monday that it has designated BNY as a financial agent to manage the initial accounts. The bank is partnering with Robinhood Markets to tap its design and technology know-how to develop a Trump Accounts app and provide customer service, according to the department.

"Our task is clear: to provide the next generation of Americans with a world-class, intuitive platform to jump-start their financial future," said Vlad Tenev, Robinhood's chairman and chief executive.