U.S. Stocks Slip as Middle East Deal Doubts Boost Oil

U.S. stock markets opened sharply higher on Monday, May 26, 2026, then pulled back as concerns about a Middle East peace agreement and a rise in oil prices pressured the Dow. Early optimism faded as traders returned from the Memorial Day holiday and reassessed the outlook.

The initial surge followed President Donald Trump’s weekend comment that the Strait of Hormuz could be fully reopened within 30 days, which briefly raised hopes of a diplomatic breakthrough. Market participants later focused on unresolved issues over frozen Iranian assets and the disposition of enriched nuclear material, matters that complicate the terms of any formal agreement.

WTI crude oil, which fell about 7% during the quiet holiday session, rebounded strongly on Monday as attention shifted to those diplomatic sticking points. The rise in oil prices increased concerns about costs for companies and consumers and added pressure on risk-sensitive assets.

Market internals showed the Nasdaq briefly touching 30,000 on its CFD quote at 30,057 before retreating. The S&P 500 printed new record highs in the morning and then pulled back. The Dow, which flashed new all-time highs before the open, retraced more sharply than the other major indexes.

Traders watched specific technical levels for short-term direction. For the Dow, intraday resistance sat near 50,800 to 50,900 with a higher cap around 51,100 to 51,200; initial support was identified at 50,400 to 50,500, with further support near 49,000 to 49,100 and 48,000. The Nasdaq faced resistance around 29,850 to 30,000 and support near 29,500 to 29,600, with momentum support in the 29,100 to 29,250 band. The S&P 500 saw intraday resistance close to 7,550, with recent all-time highs in the 7,525–7,557 range and short-term support around 7,450–7,460; the S&P’s four-hour 50-period moving average was near 7,448.

Elior Manier, a market analyst at OANDA, flagged the Dow support band and warned: “Watch out to see if the 50,400 to 50,500 support holds or breaks – the action becomes short-term bearish below the area.”

Traders said the speed of the reversal reflected thin holiday liquidity and an influx of orders as U.S. participants returned to their desks. With oil moving higher, energy and rates-sensitive stocks underperformed, and some tech names that led the opening gains saw profit-taking.

Investors are watching oil headlines, any further official comments on the Strait of Hormuz and the status of Iranian funds and enriched material, and the key technical levels across the S&P, Dow and Nasdaq to assess whether the market can resume its earlier advance or extend the pullback.