U.S. stocks rebounded sharply on Monday after signs of easing tensions between Israel and Iran. Improved investor risk appetite pushed major indices higher, adding approximately $1 trillion to the total market capitalization of U.S. stocks in a single day.

The S&P 500 and Nasdaq both rose.

On that day, the S&P 500 rose 1.02%, corresponding to an increase in market capitalization of approximately $713 billion. The Nasdaq Composite Index saw an even larger increase, rising 2.68% and adding approximately $946 billion to its market capitalization.

The market had just experienced a significant pullback. With signs of de-escalation in the Middle East, funds are returning to the stock market, with the Nasdaq, which includes technology stocks, performing particularly well.

Trump mentions ceasefire negotiations

This backlash came after US President Trump made related remarks. Trump stated that Israel and Iran are seeking an immediate ceasefire, and that related negotiations are still ongoing.

This statement was interpreted by the market as a potential decrease in geopolitical risks. For investors, if the conflict further eases, short-term pressures from energy, inflation, and risk aversion are expected to lessen.

Recovery after last week's sell-off

US stocks experienced a rapid decline last week due to the situation in the Middle East. Monday's rise reflects some funds reallocating to equity assets after the marginal easing of risk events.

However, the current market rebound is still based on expectations of a ceasefire. If negotiations continue, risk asset sentiment may continue to recover; if the situation reverts, market volatility could increase again.