The S&P 500 and broader U.S. stock markets opened lower as a U.S. naval blockade of the Strait of Hormuz took effect. President Donald Trump announced the blockade over the weekend after a peace deal with Iran fell through, threatening to destroy Iranian ships that approach. Despite the blockade, ship-tracking data from Kpler shows Iranian-linked vessels continued transiting the strait at near-pre-conflict rates in the weeks leading up to the action.
U.S. equities declined to start the week following the implementation of a naval blockade targeting the Strait of Hormuz. President Donald Trump revealed the plans after a U.S.-Iran peace deal collapsed, stating the U.S. Navy would prevent ships from passing through the key waterway. The blockade began at 10 a.m. EDT, allowing transit only for ships traveling between non-Iranian ports.
In a post on Truth Social, Trump issued a direct threat, stating, “come anywhere close” to his planned blockade. The military action aims to choke shipments of oil, fertilizer, and other vital goods from Iranian ports. Despite this, two Iranian-linked ships exited the Persian Gulf via the strait just hours before the blockade took effect.
Data from the global ship-tracking firm Kpler highlighted that Iranian-linked ship traffic had remained steady. Transits in the four weeks to Sunday averaged 2.2 million barrels of oil per day, close to the two million per day average in the four weeks to late February. Following an initial market dip, the S&P 500 recovered to be virtually unchanged by midday trading.
The Dow Jones Industrial Average remained down 256 points, or 0.5%, as of late morning Eastern time. Conversely, the Nasdaq composite index was 0.3% higher during the same period.
