Traders work on the floor at the New York Stock Exchange (NYSE) in New York City, U.S., April 20, 2026.
Brendan McDermid | Reuters
The S&P 500 dropped on Tuesday as investors grew concerned that a peace deal between the U.S. and Iran would not be struck ahead of a ceasefire that’s set to expire Wednesday.
The broad market index fell 0.8%, as did the Nasdaq Composite. The Dow Jones Industrial Average shed 373 points, or 0.8%.
Nervousness about the prospect of a U.S.-Iran peace deal was heightened on Wall Street after Vice President JD Vance’s trip to join Iran negotiations was paused because of a lack of commitment from Tehran. That’s according to reports from The New York Times and Axios, which cited U.S. officials with knowledge of the situation.
President Donald Trump had told CNBC earlier Tuesday that he expects the U.S. and Iran to make a “great deal.” The president added, however, that the U.S. military is “ready” to bomb Iran if a deal is not signed by the ceasefire deadline and that he does not want to extend it.
His comments came after the president said in a Truth Social post that Iran “Violated the Cease Fire numerous times!”
Oil prices reversed course from a big decline in recent days in anticipation of a deal. West Texas Intermediate futures increased 2.81% to settle at $92.13 per barrel. Brent futures advanced 3.14% to close at $98.48 a barrel.
“Developing trust is difficult in this situation,” said Brian Mulberry, Zacks Investment Management chief market strategist. “There is a long history with Iran that causes suspicion of any deal lasting but also their delegation may not be able to carry out much of a peace agreement given how fractured the top levels of their military and government are.”
Nonetheless, he still expects issues surrounding control over the Strait of Hormuz to be “resolved by the end of this week.”
The major averages slipped on Monday with traders on edge ahead of the ceasefire expiration and momentum slowing a bit on the market comeback. The Nasdaq snapped its longest winning streak since 1992 of 13 days.
In the prior trading week, the S&P 500 and Nasdaq notched multiple all-time intraday and closing highs on hopes for an end to the Iran war in the near future. Notably, the former finished above 7,100 for the first time ever.
Those on Wall Street, including Mulberry, remain bullish on the broader picture ahead for equities.
“What you’re seeing is a really strong Q1 when it comes to earnings,” he said, noting an anticipated double-digit percentage growth in that area as well as “strong” revenues. “I don’t think that that can be overlooked in this moment in time.”
On Tuesday, UnitedHealth’s first-quarter results surpassed Wall Street’s expectations, which sent shares of the health insurance giant more than 8% higher. The company also hiked its earnings outlook.
Meanwhile, Amazon shares climbed more than 1% on the heels of the company agreeing to invest up to $25 billion in artificial intelligence startup Anthropic.