On Tuesday, 31 March 2026 (the last day of the month and the first quarter), the global markets witnessed a set of magnificent rallies on the four major US benchmark stock indices: S&P 500 (+2.9%), Nasdaq 100 (+3.4%), Dow Jones Industrial Average (+2.5%), and small-cap Russell 2000 (+3.4%), all notched their best daily performance since May 2025.
These explosive V-shaped intraday rallies seen in the US stock market were ignited by optimism of a potential de-escalation of the ongoing five-week US-Iran war.
Iranian President Masoud Pezeshkian told EU Council president António Costa that Iran has “the necessary will to end this war” but expects certain guarantees in exchange, a hint that the Iranian leadership may be open to negotiations.
Thereafter, towards the end of Tuesday’s US session, US President Trump mentioned that the US-Iran war may end within two to three weeks, suggested the US has accomplished its military goals, and the reopening of the Strait of Hormuz may not be necessary to end the war.
On Wednesday, 1 April at 9 p.m. Washington time, US President Trump will deliver an official speech to address the current situation in Iran, according to the White House’s press office.
Interestingly, the rallies seen on the major US stock indices can be due to short-covering and potential window-dressing for month-end and quarter-end.
Technical analysis suggests a potential mean reversion rebound (a dead cat bounce) rather than the start of a medium-term bullish reversal inflection point. Let’s break it down.
#Chart #alert #stock #indices #rally #smells #dead #cat #bounce #outlook #Nasdaq #Dow #Jones #DJIA