Stocks hold near record highs, oil falls as markets weigh US-Iran peace progress

U.S. stocks held near record levels on Tuesday as oil prices fell, with traders focused on reported progress in U.S.-Iran peace and ceasefire talks.

Reuters reported that Wall Street was drifting close to record highs while crude retreated as investors watched negotiations between Washington and Tehran. AP separately reported that U.S. stocks were hanging near records and that Brent and West Texas Intermediate were easing on hopes that a ceasefire could hold and that talks could lead to the reopening of the Strait of Hormuz.

Later in the day, Reuters said oil extended losses after Iranian state TV reported it had seen a draft framework for an agreement with the United States on ending the conflict and reopening Hormuz.

The Strait of Hormuz is one of the world’s most important oil transit routes, so any sign of reduced risk there tends to pressure crude prices and support broader risk sentiment in financial markets.

The market reaction came against a backdrop of continued U.S. pressure on Iran. The White House said in April that Iran had agreed to a ceasefire and reopening of Hormuz while a broader peace agreement was being negotiated. The Treasury Department also said last week that it was still targeting Iranian oil, shipping and currency networks.

For now, traders appear to be treating the latest reports as a sign that geopolitical risk may be easing, though the durability of any ceasefire or draft deal remains unclear.