US stocks steady as oil jumps after Iran offer rejected

The U.S. rejected Iran's latest diplomatic proposal on Monday, and the White House called the offer “token improvements.” WTI crude futures rose on concerns about shipments through the Strait of Hormuz. The Dow, S&P 500 and Nasdaq traded mostly flat with modest losses.

U.S. officials described the package as lacking meaningful concessions on Tehran's nuclear program, prompting the rejection and renewed geopolitical risk. The oil gain reflected worries about possible supply disruption in the Gulf.

Major equity indexes were only slightly lower than last week's closes. Markets continued to adjust after Kevin Warsh's nomination as Federal Reserve chair, which had led traders to price a faster reduction in the Fed's balance sheet and increased bond market volatility late last week.

Early-week trading showed the initial selloff eased. Investors awaited public comments from Warsh to clarify his balance-sheet plans.

Semiconductor stocks fell after a multiweek rally, while traditional technology and defensive sectors posted gains. Financials and energy were among the strongest sectors, supported by higher oil prices. Producer manufacturing shares declined, which market participants linked to profit-taking.

Technical indicators left the Dow trading inside last week's range between about 49,000 and 49,900, with intraday resistance near the two-hour 50-period moving average around 49,726 and a resistance band at 49,900–50,000. The Nasdaq stalled below 30,000, slipping under 29,000 with immediate support near 28,900 and downside risk toward 28,000. The S&P 500 tested resistance near 7,430 before slipping back; short-term support sits around 7,320–7,340 and daily highs near 7,525.

Market participants will monitor crude oil moves and any remarks from the incoming Fed chair this week. For now, the jump in WTI added a geopolitical risk premium to energy markets while U.S. equities showed limited sensitivity to the spike.