The S&P 500 surged on Monday after President Donald Trump announced a deal to end the war between the U.S. and Iran, but Polymarket traders remain divided on whether the benchmark index can extend its gains at Tuesday’s open.
The S&P 500 jumped 1.65% to close at 7,554.29 on Monday, its strongest daily gain in weeks, as falling oil prices and easing geopolitical tensions boosted risk appetite. The June 16 Polymarket contract implied a 52% probability that the index will open higher on Tuesday, reflecting an almost even split among traders.
Why That Number Matters
Markets rallied after Trump announced that the U.S. and Iran had reached an agreement to end the conflict in the Middle East.
According to Pakistani Prime Minister Shehbaz Sharif, both sides have agreed to terminate military operations, with a formal signing ceremony scheduled for Friday in Switzerland.
The agreement is expected to reopen the Strait of Hormuz on Friday, helping drive oil prices nearly 5% lower on Monday and easing inflation concerns ahead of this week’s Federal Reserve meeting.
Investors will also monitor May housing starts and import and export price data due Tuesday.
The Bull Case
The prospect of a lasting peace agreement has improved the outlook for energy prices, inflation and economic growth.
Monday’s rally was broad-based, with the Dow Jones Industrial Average reaching a new record close while the Nasdaq posted its best day since March 31. SpaceX (NASDAQ:SPCX) shares also gained nearly 20%, extending the strong momentum from Friday’s historic IPO debut.
Still, S&P 500 futures trading was largely flat overnight, suggesting traders are waiting for additional confirmation that the Iran agreement will proceed as planned and that the reopening of the Strait of Hormuz occurs without disruption.
How The Previous Bet Played Out: The S&P 500 opened Monday at 7,516.75, above Friday’s close of 7,431.46, meaning the June 15 Polymarket bet resolved “Up.” The contract recorded about $22,933 in traded volume before settling.
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