Global stock markets edged higher on Tuesday, following a rebound in the previous session on news of a U.S.-Iran peace deal. U.S. markets paused their three-day rally, while SpaceX continued its strong run, surging nearly 50% since its debut. Meanwhile, after the Bank of Japan raised rates to a 31-year high, investor attention shifted to a packed week of central bank policy decisions.

The Dow Jones Industrial Average rose 328.64 points, or 0.64%, to close at 51,999.67. The Nasdaq Composite fell 307.60 points, or 1.15%, to 26,376.34. The S&P 500 index declined 42.94 points, or 0.57%, to 7,511.00.

As initial optimism over the U.S.-Iran deal faded, trading sentiment around the Gulf region became more cautious, with the overall market entering a more subdued consolidation phase.

In Europe, the Stoxx Europe 600 index rose 0.26%, nearing the record high set on Monday, primarily driven by gains in heavyweight stocks like Schneider Electric and ASML, which advanced 2.7% and 0.6%, respectively.

France's CAC 40 index climbed 0.75%, Spain's IBEX 35 gained 0.59%, Britain's FTSE 100 rose 0.71%, and Germany's DAX index edged up 0.08%.

Asian stock indices posted modest gains. Japan's Nikkei 225 index closed 0.1% higher at 69,404.50, having briefly surpassed the 70,000-point level for the first time ever, following the Bank of Japan's rate hike to a three-decade high.

S&P 500 futures edged up slightly, after the benchmark index gained about 2% since Thursday. Nasdaq futures rose 0.3%, with tech stocks buoyed by sentiment supported by SpaceX's strong performance in its initial public offering last week. The company's shares surged nearly 20% on Monday, pushing its market value above $2 trillion, and rose another 4% in pre-market trading Tuesday, bringing its total market capitalization to $2.6371 trillion.

NVIDIA, the world's most valuable AI chipmaker, unexpectedly tapped the bond market, issuing $25 billion in bonds. The company stated the funds are for general corporate purposes and aims to establish a liquidity benchmark for future financing. NVIDIA shares dipped slightly in pre-market trading.

Oil Prices Head for Longest Losing Streak of the Year

Brent crude futures settled at $78.96 per barrel, down $4.21 or 5.06%, as several strategists lowered their oil price forecasts.

Despite this, shipping industry sources in Asia and Europe indicated that restoring confidence for traffic through the Strait of Hormuz could still take weeks.

Meanwhile, crude oil prices are heading for their longest losing streak this year. Both Morgan Stanley and Goldman Sachs lowered their oil price outlooks, with Goldman expecting Persian Gulf exports to return to pre-war levels by the end of July, a month earlier than previously anticipated.

Goldman Sachs analysts stated: "While the details of the agreement remain unclear, we now assume Persian Gulf exports will return to pre-war levels by the end of July." The bank also cut its oil price forecast, expecting Brent crude to average $85 in the fourth quarter, down from a previous estimate of $90.

However, ING strategist Warren Patterson noted that due to significant inventory drawdowns during the conflict, energy consumers may enter a restocking phase, suggesting oil prices may not have much further downside in the near term.

Questions Remain Over U.S.-Iran Deal

U.S. President Trump's announcement of a deal with Iran initially boosted market sentiment but also created potential friction in U.S.-Israel relations. Markets are reassessing the feasibility of Trump's statement that the Strait of Hormuz would fully reopen by Friday. Iran's foreign ministry said on Monday the agreement would allow it to charge fees for shipping services through the strait, diverging from Trump's "free passage" claim.

Jefferies economist Mohit Kumar said: "Several key questions remain regarding the sustainability of the U.S.-Iran deal, including discrepancies in how Trump and the Iranian side describe the version of the agreement."

Westpac analysts noted: "While this is a significant diplomatic breakthrough that should reduce a source of market volatility, the durability of the agreement will be tested." They pointed out that many critical issues, including Iran's nuclear program, require follow-up negotiations.

Oil prices have fallen to their lowest level since March, nearly erasing all gains made during the geopolitical conflict, thereby easing inflationary pressures as policymakers assess the path for interest rates.

Japan and Australia Kick Off 'Super Central Bank Week'

The yield on the 10-year U.S. Treasury note fell 2 basis points to 4.45%. ING rate strategists noted that while the current market reaction is relatively muted, real rates have structurally risen by about 40 basis points compared to pre-war levels, suggesting the 10-year yield could remain elevated for an extended period.

Eurozone government bond yields also held steady, with Germany's 10-year bund yield at 2.955%.

Commerzbank strategist Erik Liem stated that while yields remain below key levels, the U.S.-Iran deal more resembles a continuation of the "localized ceasefire-style" market reaction seen since late May. He noted that details of the deal remain unclear, particularly regarding Iran's nuclear issues and the mechanism for opening the Strait of Hormuz, which require further negotiation.

The U.S. dollar index hovered around 99.6. The euro rose 0.1% to $1.1605, and the British pound also gained 0.1% to $1.342, as markets await the Bank of England meeting in two days, with no policy change expected.

The Bank of Japan and the Reserve Bank of Australia have already kicked off this week's "super central bank week." The Bank of Japan raised its benchmark rate by 25 basis points to 1%, the highest level since 1995, while the Reserve Bank of Australia paused its rate hikes for the first time this year.

Focus Shifts to Fed Decision

Wall Street's focus is now turning to the Federal Reserve's meeting this week, which will be the first under Chairman Kevin Warsh's tenure. The Fed is widely expected to hold rates steady on Wednesday, but attention will center on how Warsh navigates the policy balance between inflationary pressures and the expected decline in energy inflation during his post-meeting press conference.

Panmure Liberum analyst Joachim Klement said: "Markets will remain intensely focused on the Fed and how Kevin Warsh addresses the interplay between rising inflationary pressures and the expectation of falling energy inflation following the reopening of the Strait of Hormuz."

The Bank of England and the Swiss National Bank are also expected to hold policy steady this week. This follows the European Central Bank's first rate hike in nearly three years last week, with President Lagarde warning that inflationary pressures stemming from the Iran conflict are spreading from the energy sector to broader areas.

Key Stock Movements

Shares of Elon Musk's SpaceX rose another 4%, extending their sharp recent gains. SpaceX priced its IPO at $135 per share and began trading last Friday. The stock closed around $201, a 49% increase from its IPO price.

Robinhood shares surged over 9% after announcing it would cut about 10% of its workforce. Robinhood expects to incur approximately $20 million in severance and related benefit costs.

Yum! Brands announced it would sell its Pizza Hut business to private equity firm LongRange Capital for $2.7 billion. Shares of Yum! Brands rose 1.94%.