The S&P 500 index and most of the US stock market fell to open the week as the United States plans to blockade the Strait of Hormuz. US President Donald Trump revealed plans to blockade the ship route over the past weekend after a peace deal with the US and Iran fell through.
A U.S. blockade of Iran’s ports and a partial blockade of the Strait of Hormuz, a chokepoint for shipments of oil, fertilizer, and other vital goods, began at 10 a.m. EDT. According to the U.S. military, it will allow ships to transit the Strait of Hormuz if traveling between non-Iranian ports. President Donald Trump had said earlier that the U.S. Navy would prevent ships from passing through the key waterway. Furthermore, in a post on Truth Social, Trump threatened to destroy Iranian ships if they “come anywhere close” to his planned blockade of the Strait
Hours before a U.S. naval blockade of ships from Iranian ports took effect on Monday, two Iranian-linked ships exited the Persian Gulf via the Strait of Hormuz, according to Kpler, a global ship-tracking firm. The crossings highlighted that although the number of vessels passing through the strait has fallen sharply, ships linked to Iran have continued to navigate the waterway at rates close to those before the first U.S. and Israeli strikes in late February, according to Kpler. Transits in the four weeks to Sunday averaged 2.2 million barrels of oil per day, compared with an average of two million per day in the four weeks to Feb. 29.
Since the early dip, the S&P 500 is now virtually unchanged in midday trading The Dow Jones Industrial Average was down 256 points, or 0.5%, as of 11:45 a.m. Eastern time, and the Nasdaq composite was 0.3% higher.