The Dow surges more than 1,100 points as Wall Street soars to its best day since last spring

People work on the floor at the New York Stock Exchange in New York, Tuesday, March 31, 2026. (AP Photo/Seth Wenig)

NEW YORK — NEW YORK (AP) — U.S. stocks surged to their best day since last spring, and the Dow Jones Industrial Average soared 1,125 points on Tuesday as doubt swung back to hope on Wall Street about a possible end to the war with Iran.

The S&P 500 leaped 2.9 per cent for its largest gain since May. Just a day before, worries about the war had sent the main measure of Wall Street’s health more than 9 per cent below its all-time high  set early this year.

The Dow Jones Industrial Average rallied 2.5 per cent, while the Nasdaq composite jumped 3.8 per cent.

The rebound came as financial markets seized on a couple tenuous signals for hope about a possible end to the war. It’s the latest manic swing following weeks of frenetic back and forth amid uncertainty about the war. The moves also came as Wall Street marked the end of the year’s first quarter, a milestone that can cause a flurry of trading as fund managers close their books.

Analysts said optimism entered markets overnight following a report from The Wall Street Journal saying President Donald Trump told aides he’s willing to end the U.S. military campaign against Iran even if the Strait of Hormuz remains largely closed. The strait is a narrow waterway connecting the Persian Gulf to the open ocean, and a fifth of the world’s oil sails through it on a typical day.

Oil prices then took a sudden and sharp turn lower in midday trading following a news report from the Middle East quoting Iran’s president Masoud Pezeshkian as saying it has “the necessary will to end the war” as long as certain requirements are met, including “guarantees to prevent a recurrence of aggression.”

The worry on Wall Street has been that the war may last a long time and keep oil and natural gas from the Persian Gulf out of global markets, which could create a brutal blast of inflation.

Following Tuesday’s possible signals of hope, the price for a barrel of Brent crude oil, the international standard, eased 3.2 per cent to settle at US$103.97. Benchmark U.S. crude erased a gain from the morning and fell 1.5 per cent to settle at US$101.38.

Oil prices could quickly revert to spiking, to be sure, and stocks could get back to falling if tankers carrying crude can’t get through the strait easily. Iran attacked a fully loaded Kuwaiti oil tanker in the Persian Gulf in the latest fighting in the region.

And oil prices have already shot high enough that inflation in Europe accelerated to 2.5 per cent in March, up from February’s 1.9 per cent.

In the United States, the average price for a gallon of gasoline topped US$4 per gallon  for the first time since 2022. That’s squeezing budgets for U.S. households and preventing spending on other things. Worries about that and pressured profit margins for companies meant the S&P 500 closed Tuesday with its worst loss for a quarter since the summer of 2022.

The 4.6 per cent loss would have been even worse if not for Tuesday’s easing for oil prices, which helped stocks of companies that have big fuel bills. United Airlines soared 8.1 per cent, and Norwegian Cruise Line Holding steamed 5.9 per cent higher to trim their losses for the year so far.

Tech stocks were the strongest forces lifting the market in a widespread rally where four out of every five stocks within the S&P 500 rose. Marvell Technology shot up 12.8 per cent after Nvidia invested US$2 billion in the company and announced a partnership with it. Nvidia rose 5.6 per cent and was the single strongest force lifting the S&P 500.

Centessa Pharmaceuticals soared 44 per cent after Eli Lilly said it was buying the company working on treatments for excessive daytime sleepiness and other neurological conditions. Lilly, which is paying up to US$7.8 billion if certain conditions are met, rose 3.7 per cent

They helped offset a 6.1 per cent drop for McCormick. The spice company is buying most of Unilever’s food business, including such brands as Hellmann’s, for cash and stock valuing it at US$44.8 billion.

All told, the S&P 500 jumped 184.80 points to 6,528.52. The Dow Jones Industrial Average climbed 1,125.37 to 46,341.51, and the Nasdaq composite rallied 795.99 to 21,590.63.

They benefited from easing pressure from the bond market, where Treasury yields sank again. The yield on the 10-year Treasury fell to 4.31 per cent from 4.35 per cent late Monday and from 4.44 per cent at the end of last week. That’s a significant move for the bond market.

Lower yields should pull downward on rates for mortgages  and other loans for U.S. households and businesses, which have been screaming higher since the war began. The yield on the 10-year Treasury was at just 3.97 per cent in late February, before worries about high oil prices pushed traders to erase bets for cuts to interest rates by the Federal Reserve this year.

Yields remained lower following a couple reports Tuesday on the U.S. economy that came in better than economists expected. One said confidence among U.S. consumers unexpectedly improved. The other said U.S. employers were advertising more job openings at the end of February than expected, though fewer than the month before.

In stock markets abroad, indexes rose in Europe following a tougher finish in Asia. South Korea’s Kospi fell 4.3 per cent, and Japan’s Nikkei 225 lost 1.6 per cent for two of the bigger moves.

Stan Choe, The Associated Press. AP Business Writers Chan Ho-him and Matt Ott contributed.