By Sabrina Escobar

Will They/Won't They? It isn't yet clear whether the U.S. and Iran will be able to reach a cease-fire deal in the near future. But the market's rally on Wednesday suggests that investors are optimistic a resolution could come sooner rather than later.

The Dow Jones Industrial Average rose 305 points, or 0.7% on the day. The S&P 500 was up 0.5%. The Nasdaq Composite gained 0.8%. All three indexes were on pace for bigger gains earlier in the session in response to lower oil prices, but they pared those back slightly after oil prices ticked up in the afternoon. Brent crude oil futures settled just under the $100 mark on Wednesday.

Small-caps also had a big day. The Russell 2000 gained 1.2%, bringing the week's gain to 4% -- on track for notching the 10% increase the index needs to exit correction territory, which it entered on Friday.

Oil's pullback and the market's subsequent rally reflect cautious enthusiasm that cease-fire talks with Iran are progressing and could bring an end to the conflict.

The U.S. sent Iran a 15-point plan to end the war, The Wall Street Journal reported. The plan demands that Iran dismantle nuclear sites, end uranium enrichment, and stop working on ballistic missiles. Iranian officials have dismissed the plan, according to the Journal, and have repeatedly denied Trump's claims that negotiations are taking place.

Even so, there are signs that both sides are looking to de-escalate -- at least partially. On Tuesday, Iran's mission to the United Nations said nonhostile vessels could pass through the Strait of Hormuz, and White House press secretary Karoline Leavitt said the U.S. had been engaged in "productive conversations" over the past three days.

"We may not be at the end of this situation, but we could be at the beginning of the end," said Mona Mahajan, principal, head of investment strategy and asset allocation at Edward Jones. "Negotiations toward a resolution appear to be under way. The more important question is what happens with the Strait of Hormuz and oil prices."

Oil prices aren't likely to fall much more until there is clarity on the state of negotiations and regular traffic resumes through the strait, experts say. Shaikh Nawaf Al-Sabah, the CEO of Kuwait Petroleum Corporation, said on Tuesday it would take months for Middle East oil to fully return to prior production levels, even after the war ends.

The Hot Stock: Super Micro Computer +8.2% The Biggest Loser: Verisk Analytics -5%

Best Sector: Materials +2% Worst Sector: Energy -0.5%

Sit Back, Relax, and Enjoy the Flight

It's been a while since anyone thought of flying as relaxing. United Airlines wants to fix that. On Wednesday, the company unveiled a new seating option called "Relax Row" that lets economy passengers turn an entire three-person row into a couch that lies flat.

Relax Row is set to launch in 2027, with up to 12 rows available per aircraft on more than 200 planes by 2030.

My colleague, Callum Keown, writes:

While it's a first for a North American airline, Air New Zealand has been offering its Skycouch economy seating since 2011. The idea was to generate more revenue per available seat -- charging a premium for the spacious row on top of the price of three individual seats. There could be further revenue opportunities for United, too, as the U.S. carrier said it has North American exclusivity on the design. Air New Zealand has licensed its design to other carriers, including Taiwan's China Airlines.

United stock initially ticked up on Wednesday but closed 0.7% lower. Other airline stocks, including American Airlines, Southwest Airlines, and Delta Air Lines all closed higher on, although that's likely more a reaction to lower oil prices than United's seat announcement.

That said, to anyone who's had to catch a flight over the past few weeks, the hourslong wait at security checkpoints have been a bigger pain point than fuel prices and uncomfortable seats. Unfortunately, that doesn't seem to be easing up soon.

Early Tuesday, there were hopes that Republicans and Democrats could be nearing a deal to end the nearly 40-day shutdown that has left Transportation Security Administration agents without pay. But those hopes dimmed on Wednesday as initial support fizzled out.

"The president has been hostile to any deal that isn't tied to the SAVE America Act, a GOP-sponsored bill that would require photo ID and proof of citizenship to vote," writes my colleague Emily Russell. Trump had also rejected funding plans that would reopen all DHS agencies except ICE, she adds.

The Calendar

The Department of Labor reports initial jobless claims for the week ending March 21. Jobless claims have been stable recently, averaging 210,750 a week over the past month, reinforcing a "low-hire, low-fire" labor market.

What We're Reading Today

   -- The Oil Shock Is Just the Start. Why Inflation Could Reach 4% -- and Stay 
      High for Years. 
 
   -- Microsoft Stock Tracking Worst 6-Month Stretch Since 2009 
 
   -- Wall Street Is Going Gaga for Robots. Aptiv and Other Stocks Will 
      Benefit. 
 
   -- Has the AI Bubble Burst Already? Why This Economist Says the S&P 500 Peak 
      Has Passed. 
 
   -- JetBlue Stock Soars. The Airline Is Exploring a Sale, Report Says. 

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March 25, 2026 19:55 ET (23:55 GMT)

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